Being happy personally is the pathway to help everything else makes sense. And that is around mental health and I think the key unlock for mental health is just finding a resource to talk to and when you first start talking it's going to be just kind of blathering bullshit and it's going to be imprecise and it's going to be super awkward and you're going to feel like what is this and then over time it's like anything like when you start to get good at it.
It's it's really good.
Welcome to the knowledge project podcast. This is Shane Parrish this podcast and our website FS dot blog help sharpen your mind by mastering the best of what other people have already figured out. If you're hearing this, you're not currently a supporting member and are missing out. If you'd like access to add free versions of the show Early Access.
A full episodes transcripts and so much more you'll have to subscribe at f-- s dot blog / podcast there. You'll find our private RSS feed and other subscriber only content check out the show notes for link. My guest. Today is chamath Polly habit idea to moth is the founder of Social Capital part owner of the Golden State Warriors and so much more we talk about what it means to be an observer of the present how to think in first principles the behavior and psychology of successful investing and so much more including the
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Cost you walk away with a well-designed custom tailored solution that you could tweak and maintain all by yourself without the need to hire expensive developers. So if you've got an app or website idea where you're just ready for a change of pace from your current agency let the team at 80/20 show you how no code can accelerate your business check them out at 80/20 dot Inc. That's 8020 dot Inc. Chmagh, man. I am so excited to talk to you. It's been a long.
I'm coming.
It has been we've tried to organize I think for many months. It may be if not a year and I just I think though the first schedules were a little tight and but then I had to reschedule once or twice. Oh, I'm sorry.
Oh, no worries. Originally. We were supposed to do it in Toronto and then all the world changed
the world has changed.
Hey, every time I look around you're on the news man. What's up with that?
Well, I think that it's sometimes valuable when you can actually just like
The truth not sometimes all the time and I think that most people are pretty guarded because they have to be I don't think they're necessarily always in a position to be as candid as they want to be and I think that in moments of sort of just Clarity I have, you know constantly just tried to say what I feel and I think that I wasn't it's with a lot of people.
Well, it definitely does I treat it out today that you were coming on the show and I think we had like over a thousand replies and people leave everything from like ask him.
What I should do with my life to how should I think about the future to what should I invest in your like everybody's Guru man?
I mean, I think the ball is the guru but the brown brother from another mother I think event. I think that I've gone through a lot of you know, kind of like Ordinary People shit and I think I talked about it in really simple plain-spoken terms and I think that that's really useful to people because it demystifies a lot of things and just makes it
Kind of more normal and that's been a real team of my life is just realizing that a lot of the things that I went through is normal and feeling part of a pack is really helpful. Actually. It's been really helpful for me because it's helped kind of like regulate my sense of self-worth and lift it up and moments where I felt pretty crappy about myself and that's just resulted in better outcomes. So I think like a lot of what I talked about I think folks relate to because I speak to it from through that lens and
They just think that's a really good place to be actually, it's taken me a long time to get to that place, but it's good place to
create double click on that for a second. I mean, you've got an interesting background right? You worked at AOL went to Facebook. You're a billionaire 32 you're a sports team from the outside looking in you've had the most amazing life, but on the inside looking out, you didn't feel that way.
Yeah, I think a lot of people have to do things that are motivated by other people.
Perceptions of them and also motivated by the pressure that is exerted by the people that are very closely around you that sometimes can be your friends. It can be your family and I was very much of that category. So I was kind of just you know Meandering through life. Now that Meandering turned out to have really good outcomes in some respects. The problem was that all it was doing was just sort of like, you know, avoiding the inevitable and the inevitable is this moment that I think
Everybody goes through where they're asking themselves, whether they lived a completely fulfilling life the way that they Define it. You know, what I'll say. She is that I think that sort of not even necessarily Millennials but you know Zoomers underneath them. They're the most honest of any generation about what makes them happy and you see that in you know, the way that they dress the music that they listen to the media that they consume the way that they
You know sort of like push back on kind of like a more corporate kind of, you know, tone and things and they're willing to be happy in a way that they've defined for themselves in my generation of 44. That's not how it goes down. The way that it goes down is you go to the best school you can you take on as much debt as you need to you try to get the most credential job after college, you know, you kind of just check the box you find, you know a reasonable person that
That you marry, you know, you have 2.5 kids you buy a house in the suburbs you save for retirement and I just think for a lot of people they realize that that's not the path of Maximum fulfillment and that being happy actually get generates also better outcomes, you know, you have better artists your better Engineers. You have better everything if people are ultimately just happy and I think that generation of people know that a lot more inherently Than People My Generation or Boomers the generation of ugly, too.
What did you come here to that with? How did you define happiness the end of this you sort of went through this journey.
There's a great article. It's not sorry. It's not even an article. It's a it's the obituary of Steve Jobs with by his sister and she wrote it - and since you wrote it in the New York Times upon his death and there's just a paragraph in there, but I think the phrase that he said was like sort of like, oh, wow. I need just kept repeating. Oh wow.
Wow, as he was passing the way and I interpreted what that may have meant? I have no idea obviously because I was not around to tell us that that's what happened. But I have this idea The Sensation that he sees his family. He thinks about the totality of his life lived and he was happy but think of what that happiness was able to create not just for his family, but for the entire world and so I do think that you know on the one hand you could say, you know, he was fanatical.
There was a tire and it was hard work for you know, etcetera Etc. But on the other hand, maybe there's a different way of saying it which is that key was very content. He had a family that loved him. He had a family that he loved and as a result of that happiness, he was able to leave that Sanctuary go to work and take that happiness and channel it into doing amazing things for other people. That's a pretty cool idea. And so I think that what I would like to live through is that
version of the truth for me that oh, wow. Oh wow. Oh wow idea. And how do I Define it? And I didn't even know that that should be a way to live my life earlier on and you know, when you're talking to me today as a 44 year old guy is I've learned that there are things that gave me these. Oh, wow Sensations that I just absolutely love of just name a couple there, you know even today this happened. I you know, I'm
Working a lot these days just really kind of grinding on a lot of stuff and these are high pressure decisions that I'm making a lot of the time for me. And so they consume a lot of my mental mind within bandwidth and it's really exhausting and if there's pressure and you know, sometimes I honestly I just feel like like I just need to just like cry like I'm just like I feel really stressed out these moments and you know fighting uphill I feel
and today I was driving to the office and I was having one of those moments and I turned around and I went back home and I went to see each of my four children and I kiss them and I went to see a partner and I kissed her and I felt just this moment of just sheer happiness. Like I felt like that's what I have accomplished. I built a sanctuary for my family filled with love and then I got into the carpet keys to the office and
That's a no while movement every summer now I have these. Oh wow moments because my partner is Italian and I, you know had never really spent a lot of time in Europe. But in the last four years, I spent it obviously a lot of time in the Summers and my children and I have fallen in love with Italians. I mean and what have we learned, you know, we've learned to like love the food love the culture the boisterousness the loudness the love the intensity the energy I think about
Her down. I just it's like wow, I love it. So I've learned to find things that I really appreciate a third one and I'll just I'll stop at that is I have a group of friends and we played poker together. And if I think about how happy it makes me there's a thing that we do which is we show up at four o'clock. We plan till about 6:30 and then we have a dinner together like a family dinner and move long table and then we go back and we play for a few more hours that stopped when the Coronavirus
Started because we couldn't come together with a we've been able to get a bunch of Rapid tests. And so for the first time the Saturday we're going to come together and play and I think about this and I'm just like, oh, wow, like I cannot wait to see them. So, you know and I think about this chain, none of that is about CNBC or a good successful company. Those are important and those are good demarcations of progress, but those aren't my oh wow.
Moments anymore and when I put too much pressure and valuing those being the oh wow. Oh wow moments. I got distracted and I became a copy and as long as I stay centered on these other things I have so much more energy to come and work on those first order set of you know, business priorities and get things done and I'm trying to achieve something but it's at the very early stages which is not done yet.
Yeah. I want to talk about that before we get there. There's a couple rabbit holes that I sort of want to explore their you mentioned Zoomers were willing to speak.
Truth their truth pretty easily and it was harder for Our Generation. But you're also you know, you're full of controversy. Sometimes it doesn't strike me that you have a problem speaking your truth or you've ever not said what you felt.
Well, it's not that I've always not I think that I learned to lie at a very young age because lying I think is one of the most simple coping
Isms that we all have and lying manifests in all kinds of very subtle corrosive ways. You know when I was growing up I had a I have a family who fundamentally we all love each other but and it's a very complicated contorted form of love because it's punctuated with you know, some mental health issues, you know, alcoholism, you know, depression poverty. And so, you know when I was a young person the way
Coke is to lie. Are you okay? I'm fine. Did you do that? I didn't do that. You know, where were you know, where how did you do on that? Test fine? I learned to be evasive and what that created was a deep-seated pattern of lying and avoidance and you know, people can say maybe lying is not what that is. But at the basic, you know kind of just to simplify, you know, I learned to lie to cope. I think that at some point
Point I think almost sort of at a very, you know, physiological biological level. That's not what any of us want to be. And so I think that I had almost this form of organ rejection. And so I had to almost you know, go to the other end of the spectrum almost in a way of atoning for all of the years of lies and all of the accumulated mistruths or half truths or evasiveness whether that was in my personal life or my business life.
And the first Moment of clarity around that was actually when I went to work at Facebook because for the first time I was unbelievably candid and it was such a cathartic release because I could be you know, almost curmudgeonly in my Candor so much so that it's Point probably I was a bit of a caricature because you know, there was this guy me who seemed very, you know, almost acerbic at times just threw a little rough around the edges and I took it to an extreme there.
And then in the early parts of social capital, I actually think I reverted and I was lying more again because I was I was filled with a new level and a new kind of insecurity around, you know, I felt like an imposter in venture capital. I felt like, you know, I didn't earn the right to start a fund. I didn't and I gave myself all of these hurdles that I put in front of me mentally and my solution was to try to be evasive until I my way through and then in 2016 and 17
Again, I think I had an even much more cathartic form of organ rejection around it. And I had to sort of recalibrate the life around me so that I could stop lying and I thinking that I think you you're finding a person that tries to be truthful as often as I can and often times what that means is saying the uncomfortable thing, but it's a thing that needs to be said and I think that there's a lot of people who appreciate that because they themselves
It's feel like they're sometimes caught in positions where they have to be evasive, but they have to lie in order to cope and you know, if they themselves aren't in a position to and I think they appreciate when others can be and I think that a lot of people have a very positive reaction to that and I think that's in part what but I think people get a sensation when they interact me sometimes so I'm not sure I'm necessarily controversial. I do think that I'm behaving in a way that I think a lot of folks.
I would love to be in a position to do as well. Right? I don't think it's actually correlated to money. I think that it's more correlated to self-worth and the comfort that you have with yourself the limitations that you have and then the ability to love yourself despite those limitations. That's a process that too few of us start and it's like I said, it's not a money.
I think it's it's happiness. And so closing the loop on how you started. I think that you know Zoomer is in this interesting way see all these Generations, you know, a folks that are older than them, you know, 30 year old forty-year-old 50 year old 60 year olds 70 year olds 80 year olds and we live long enough now where they see multiple generations of evasiveness and unhappiness. Really? Yeah, and and they see similarities.
He's in all of us that they're smart enough to decide that they don't want to exhibit because you know, it would be one thing Shane. If you saw an 80 year old while you could say, I'm not going to be like that person, but then you see a seven-year-old and you're like wow, that's just a junior version of the 80 and then you a 60 year old and you see that and a 50 year old and because we're all alive, you know, the 20 year old sees eight generations of people ahead of them and they're like, wait a minute something here is wrong and they're smart enough to say what are the commonalities of all the spokes?
And they choose to be
different still deal with imposter syndrome all the time. What are you tell yourself in those moments?
First of all, I talked to my partner. She has been my spiritual partner my kind of like copilot because she really has an enormous level of empathy and Care around her own mental health and you know the mental health of our family, so we talk a lot, you know.
And we talk about nonsense and serious things and everything in between but we just talked and I found that as a man I was taught that talking is weak. I also found that as a immigrant man. I was taught that talking about emotions was doubly week and then I was you know, sort of taught as kind of, you know, like in this industry that you know talking is awkward. You put all these things.
Together and you know, the biggest thing that I found that it's helped me is just talking and being open and it starts with her my kids. I'm really open and transparent with my kids. They think I'm a you know, basically a fucking loser. I think that that's really cool. You know, they just they just roll their eyes every time that I start talking because it's like some stupid diatribe, but all of these things help me stay really connected to the goal of being
Before that helps me stay connected to the goal of being happy to celebrate these old. Wow, kind of moments in my life that helps me. But to be honest with you that has to be an active process for me because the that thing that you just said change is overpowering for me, the sense of being an imposter is overpowering and it's like this dragon that I've been trying to slay my whole life and I haven't been able to and the more I don't even want to say success.
Yes, but yeah, I guess like the more like notches up the ladder I go the more severe it feels and the harder it is for me to fight back. So, you know, I had this conversation with Matt yesterday and you know I said to her like yeah, I feel like this is why so many people just give up because it's easier to do it than to fight and to solve the real root cause of what allows you to get to the next level of success.
That's really why you know, you have to look at folks that have really overcome the stuff in however way they've done it and achieved a level of success and really celebrate them because they're they have a level of mental fortitude that is exceptional. But yeah, I'm I'm dealing with him right now. It's imposter syndrome. And it's I think it'll be a battle. I feel like my whole life, you know, some people other people have different battles, but that that is definitely mine.
What keeps you going. I mean you could just fold up walk away live an amazing life you and generations of your errors.
What keeps you sort of pushing through this confirming this Dragon
II do think that I get a level of enjoyment from it, you know this idea of like, can I beat it? I like how I feel when I'm more connected to the things that make me happy. I like how I feel when I think like when I think that I am doing things that the younger version of me would be proud of not the older version is it's interesting like a lot of people think like, you know, like at your death
And I think exact opposite I think like you know, what the 22 year old self, you know interacting with this person, you know with the 16 year old person like think. Wow, that guy is that's a legit human being like he's you know, he's putting himself out there trying. So I'm motivated to keep kind of grinding and getting better. Just seeing what the upper
bound is interesting a lot of a lot of people are like, oh if I just had like 10 million dollars or something, I just walk away and I'm like, well, that's
probably the reason you might never have 10 million dollars, right? Because the people that achieve that keep pushing and keep struggling and can't actually walk away and somewhere.
I think that money accelerates the point at which you can declare yourself free. Mmm and feel emancipated like I do think that money is a liberates people it gives them freedom, but going back to what we were saying before it doesn't make you happier.
If you are ill equipped to then run that race to happiness race and you do it with money its destructive. It's more destructive than if you do it without money because you know, if you're unhappy and your unconstructive Lee trying to find your happiness and you have cash, you know, you'll end up, you know, gambling broke dead. Hi, you know, like it's all the typical cliches there and they played themselves.
Out of her, you know many generations and they'll continue to do so. Yeah. I think that like this is why I think people can separate these two paths and actually work on the concurrently one is the path to freedom and the second is the path to happiness. I think the path to happiness is an internal process, but the path to Freedom that I can help with, you know, because I think I've learned an accumulated amount of knowledge here and it's readily
It's verbal the happiness path is not because it's each of us have our own lived experience, which is so different from everybody else's and so all you can do is kind of listen to other folks and decide you're going to start for yourself, but the answers are not obvious and it's all iteration. But path to Freedom is easily copied and I think that that's sort of sort of what what motivates me as well this idea that I could sort of, you know, all that accumulated knowledge base. I can just hand it off to folks and if
They can benefit from it. That would be great.
What is the path to Freedom?
Plus our Financial Freedom. So I think I think I think that if more people believe that they could be economically self-sufficient. I think that it would solve a lot of the societal implications of inequity, you know today we have kind of like this very polarized body politic really where on one hand.
Enter folks that have over sort of indexed on what I would call absolute freedom and intent but it has no plan and on the other side. It's sort of over indexed on a nanny state with no plan. Both of them are very much the same and that neither of them have a credible plan and in the middle, there's a plurality of people that are just exhausted.
And that's a that's a perfect boundary condition for you know, a lot of the inequity that that exists today in society and a lot of the frustration that people feel as a result of it. So to me if we can give people a more reasonable roadmap where they can execute it. They can learn and they can have a community of other like-minded folks that can put in the time and the work and help each other over, you know, five ten fifteen twenty years to
Capital no matter how small but just to start I think you'd be surprised at how many people are intellectually capable of achieving Financial Freedom on their own. And in that I think that there's there's a path out of this kind of like very depressing kind of state that we're in that that I think is the opportunity is so, you know, I'll give you an example in 2015. I think we've started to really pay attention to Tesla.
And we bought these convertible bonds and you know, we thought they were really great, you know risk adjusted because you know, we weren't sure whether the shorts were going to win and drive the company into the ground, but we were really sure we wanted to bet on Ilan long story short it all kind of worked out and now you look back in your like my gosh this is incredible, but there was so much knowledge that helped us feel like we were making the right decision that existed in this long tail of people.
Took it upon themselves to build a community of people that wanted to understand the company not necessarily just to be a blind cheerleader, but they would really go and double-click and they were doing a level of work that was incredible and I thought that was so interesting because I thought to myself, you know, typically what would happen is you would put your money into a bank bank account. You would open up a brokerage account. Maybe you would get access to some research from one of the bank's you would read it or maybe
Be an advisor would recommend something to you or maybe you'd end up on some random community and read some random formed by something. But instead these were like physicists and you know chemists and you know Financial people all coming together to understand these things. They were writing research notes. They were putting out, you know, YouTube video clips and if you took the time to understand it that Community was helping you understand something really important that was happening in the world and
Could have financially participated because you could just go and buy that and it would have worked now. Let's extrapolate that idea. Forget Tesla for a second. There. Is this incredible thing that's happening which is that we are starting to financial eyes everything right? We're starting to create Financial increments attached to anything you can imagine meaning, you know, it used to be the case that you would only buy sneakers.
Now you buy and sell sneakers and you know, the marketplace that that is the leader in that, you know, go today just announced that they raised, you know, 200 million dollars at an almost two billion dollar valuation. So is it a is it an e-commerce Marketplace? Maybe I look at it as a financial Market. They fractionalized shoes essentially and they fractionalized and they practice financial transaction layer around taste and taste maker.
You know, there's there's a company called pipe. There's a company called Rally Road. All these folks, you know are you know fractional izing ownership of all kinds of things. There's crypto obviously their stocks. There's no specific Bond. So the point is the surface area. The investable universe is growing. Some of it is still very regulated. Some of it is really unregulated, but the trend is obvious. So we're going to financial eyes everything.
And we're going to fractionalize ownership of probably everything and so what there is an opportunity now to do is to curate and cultivate a community around that to help people and that's really what I would like to do. I think that it would be a really useful thing to level the playing field so that whether you're you know, Mom and Pop schoolteacher with 5 or 10K, you're a new grad with, you know, a thousand K that they had saved up or whether you're an accredited investor. I don't judge.
I would like to treat them all equally and I would like to say look I've made some mistakes. I've had some winners. I've really learned how to allocate Capital here's how I see the world and here are ways in which I think that you could participate beside me as my partner and if you want to you can and I'll always put you know my money on the line so that you know that I am not trying to surreptitiously become an agent. I am a principal
Oil and I think that if we can organize that in some useful way, I think that we can help a lot of people achieve freedom and if they're concurrently working on happiness, I think you'll really fuck some shit up and fixing stuff really good.
You said you in a previous I think interviewer may be on Twitter that your job was to be an observer of the present was wondering if you and double click on that.
Yeah, I'll give you something that
You know drive to your listeners and viewers crazy. Let's look at the 2020 election from first principles. That's really look at it from first principles. Well, let's think about foreign policy and foreign policy. I think are really four things but it really comes down to three things. So number one are sort of like nefarious State actors, right? Let's just let's just use an example illustratively Russia my I think most people feel like, you know, Russia is pretty
Sketchy and you know, they're generally quote unquote bad. Okay. Well, let's let's let's think about another state actor, you know North Korea. I don't think you're gonna see a lot of people jump up on either side of the aisle supporting North Korea. Let's think about China. I think that we've all realized that you know, the bloom is off the road off the rose and that, you know, we've allowed globalization a strain of globalization that has put America strategically on her back heels, and that doesn't make any
Sense, you know, we may not have access to our own semiconductors. We don't have access to critical, you know rare earth metals to drive electrification. We you know have outsourced critical parts of our Healthcare infrastructure to folks that, you know can dictate whether we can take care of our own people. That doesn't make any sense, right? Everybody believes that now let's take the Middle East, you know, the Middle East was incredibly critical because you know a handful of Western countries coming out of World War Two essentially divvied up and build some artificial Maps.
Soooo, essentially to make sure that we had access to this precious resource oil. Well, you know in 2020, we now have you know, a 20 or 30 or shot clock where we decided that we're going to stop burning room. You know, we've essentially already stopped burning coal and it's just a matter of time till we stop burning fossil fuels well at that point the Strategic relevance of the Middle East decays significantly. So think about that now so from a foreign policy perspective both sides basically see the world in the exact same way Democrats and Republicans.
They both hate Russia. They both say China and they both think that energy Independence means that the Middle East won't matter. Wow, that's observing the present. Let's take a different example think about monetary and fiscal policy, whether we like it or not. We used to be in a world where fiscal policy and monetary policy were separate.
Sometimes they would be along the same lines, but they were separate bodies acting independently now the treasury and the FED are inextricably intertwined and it's not just in the United States. If you look at it this problem in, you know, Western democracies in Europe. It's the same situation. This is crazy. Right? We have inexorably brought together fiscal and monetary policy.
That's just the facts now. Let's look at spending.
Whether you call it the green New Deal on the left or the infrastructure bill on the right. We are going to spend in the next decade tens of trillions of dollars to try to dig ourselves out of this unemployment and GDP whole that has been exacerbated by the coronavirus pandemic that's going to happen. Neither candidate will come to the American people and say we want to spend a trillion dollars on, you know digging up.
Coal from the ground burning coal fired power plants. It's not going to happen. Once going to call it a green New Deal the other person's going to call it infrastructure spending, but we're going to radically change the face of how America operates as a functional economy. Okay, and it's relatively predictable in my opinion how they're going to spend that money. So if I Keen Observer of the present if I would put all of that together can also
I say something very controversial which is we have an election that is now actually of style and not of substance now, that doesn't mean it's not important.
but substantively the positions on critical matters of foreign policy domestic monetary and fiscal policy and spending will roughly be plus or minus the same it takes a lot of mental fortitude to think through it and look at it that way and not let one's own biases jump in because it will tear you into you know, two thousand different mental pieces, but that's what I mean by being a keen Observer of the present so
Okay, what is this election? Come down to I think it comes down to political correctness versus cancer culture.
If I have to kind of summarize it in a nutshell, that's what it is.
And I think that people will vote on November 3rd about which outcome they want because substantively in action the spending patterns the policy decisions will roughly be the same and again see if such a controversial thing and I think people can just go absolutely crazy to hear somebody say that
you're going to go crazy when I don't ask you who you predict will win. But what I really want to know is how do you take that and then what do you do with that in the future? You said it? Okay. Well this
Is going to be a predictable path of spending. How do you as an investor then take that knowledge?
That's a fabulous question. So this goes back to what I'm trying to do, which is if I can observe the present in a reasonably unemotional and detached way to your point. I can put a plan together and when I have a plan, you know, that plan is specifically for me oriented around how I'm going to make sure that the idea
is that I want to see exist in the world when and this is going to sound maybe turn people off the way I say, but at my level of capital, that's what I could do. I Can Vote with my dollars to really make things come to life and I think that that I really take that job seriously and I aim to do that now which is like, okay. I'm learning how to be happy. You know, I've achieved a level of freedom, but now it's about change and I want to implement my form of change and I want to see that in the world. So I'm trying to
About how my ideas have a better chance of succeeding and then I want to make sure that I Implement a plan to make that happen and then that adds to my knowledge base and then my hope is to share that with other people so that they can then learn from that as they will and maybe they can they can also do their version of the of the same thing. So, you know, if I was really I was six years old in 1980 or no four years old in 1980, but imagine I was 34 years old. I'm 44 years old.
I would have woken up and I would have said read the paper doesn't matter. How much money is it? Okay, if I knew then what I know now, I would wake up in 1980 and say oh my God, the 30-year rape is at you know, 15 16 percent interest rate man this thing, you know if I had to take a guess I really believe in the productivity and the Ingenuity of America. I'm just going to be I'm going to take a guess that 15 percent goes to zero before 15% go.
50% and you would have been really bright and 80s 90s. Mm. And now the 2010 have you just been levered long equities, right? Yeah, you would have made a fortune and you would have been right and you would have achieved Freedom. It doesn't matter whether you started with $1 $10 a thousand ten thousand ten million. You would have been unbelievably rich and in many ways, you know Buffett Simplicity Warren's Elegance of his mental.
model
And I'm not trying to diminish its killed by saying this is is a keen Observer of this most important high-level order idea, which is that rates are going to 0 productivity is going to go up Ingenuity the resourcefulness of America goes up. I want to be long that amlong equities. It would have worked now. Okay, where are we? Well, we're rates at zero rights? Okay. So let's take our all cumulative knowledge and look at today. Let's just be a keen Observer of the present.
Rates are at zero. Where are they going to go? Are they going to go to negative 5 or plus 5?
Well now the key question is while probably on the margin you your instinctive reaction will be plus 5 and I would say why I mean what Y is 0 some artificial number where everything starts and stops. This is not like temperature. It's not like we're saying it's absolute zero right? It's not like there is no colder temperature than you know, 200 or whatever Calvin to 60-something Calvin whatever it is. It's just zero.
Like zero degree celsius. Can you have negative 1 degree celsius? Of course ask anybody that lives in the midwest, you know the East Coast so could rates go to- Yeah could raise for positive. Well, I don't know I found observing the present what I would say is, you know, the overwhelming majority of the value in the last 10 years has been about educating billions of people all around the world that things are roughly deflationary meaning as long as you wait tomorrow.
Row And Delay gratification somebody will show up and give you more for Less, right? You know, I had a I don't know making up the name of a company. I had a storage account dr.com all of a sudden drop box showed up and said more for less and then I was using Dropbox for a while and then Google Drive showed up and say even more for even less. I'm pretty sure that the next person that figures out how to do storage and scale will come up with even even
Or for even even less Facebook did the same thing, you know Spotify does the same thing Netflix does the same thing all these things that create so much value our training us psychologically to behave in deflationary ways to delay gratification slightly or to make the cost of switching. So low that even if you don't want to delay gratification, you can just change your mind later and cop to the next thing that gives you more for Less. So it is very conceivable that we are in a deflation Airy.
ER for a long time now, it's also possible that inflation to go up so my kind of view as well. I need to answer this problem in a different way. And the way that I would try to answer this problem is to say to myself. Well, what sectors of the economy will benefit irrespective of whether we go to negative 5 or plus 5
Because I don't know what the answer to that question is. It'll be obvious in hindsight, but if it's not obvious today, and so I construct an allocation for myself to try to solve for that. Well people are going to be buying things. So, you know, they're probably going to be buying things online. So, you know e-commerce consumption. That's a big category that will win whether rates are at minus 5 equals 5 people need to care about health care, right? So they're going to consume things and there's
there's probably going to be pressure over time to do, you know better and better things and more useful things just because you know, we can't keep spending the way we are with the outcomes that we're getting right? Okay, so that's that's the second category, you know, we probably want to have a reasonable way of equipping ourselves with skills and education. So that's another big category. You know, we're probably going to need to have clean sustainable energy.
Gee, that's another category. We're probably going to want to eat in ways that are more constructively useful for us. That's another category. We're probably going to want to hedge just the chance that none of us knows what we're doing. So, you know, you need some kind of like alternative asset category. That's another thing so you can kind of go down the line, you know, whether you use Maslow's hierarchy or something else as a jumping off point and kind of say look the answers the high-level answer the framework.
It is obvious Health Care education climate change fintech blah blah blah and then you need to fill in an allocation. Then you need to figure out the mix of you know, early stage versus late stage or public versus, you know, some of these other things and then you can construct an answer. So, you know the way that I answer this is to say well, I'm basically going to be long growth
Because whether rates are at minus 5 or plus 5/2 thing that overcomes all of that noise is fast growth and CEOs that can invest all the money they make today for the future simply because I can now lazily let that person work on my behalf because that's less of a problem that I have if you as a CEO shame if I was invest in your company, and you said jamaat, I generate 30% free cash flow and I'm going to give you a dividend.
I would say Shane fuck you. I don't want that
money. Keep that shit. What am I supposed to do with it?
Reinvest it grow faster, please. I mean one of the most incredible insights that we figured out in 20 2014. I sold all Facebook all my
shoes everything you will read in Amazon didn't you
but the way we underwrote that investment. There's a guy I was working on our team who now runs a hedge fund young guy brilliant guy who randomly emailed me and I ended up higher.
During emailing inbox at Social Capital.com. This kids sake @w, great great guy. He's got a kidney. He was a kid and we worked on this analysis and basically, you know, he said to me trough. I think that Basil's is a better Capital allocator than Buffett. I was like, what the hell are you talking about? And we constructed this really elegant Charter which showed basically the p&l of Amazon and it looked at every expense line.
And he had taken every single expense line created a product around it and made it a revenue one. And I thought man this guy is a genius by the way back deck is floating around so you can see this chart out there in the wild, but that's capital allocation. That's really skillful. So you want that you want you want a guy that's basic like listen guys. I got this we're going to generate a couple billion dollars. I'm going to put all of it back in the ground for you, and it's going to grow really well and just trust me.
And I think that those are the real high quality folks you want to get behind. So basically my solution is you got to be long growth higher growth the better in the areas that matter for people and I think that you know in 10 years from now that will be a Playbook that really works. By the way. That sounds kind of like, he's not saying anything. I think it is. It's saying something because like, you know the historical model of how you would get freedom is, you know, 60% equities 40% bonds, you know, the 60% you would say, you know, you be long ETFs Maybe
Okay. Well, you know long ETF is basically longfang and I think that you want a little bit more uncorrelated exposure than just saying. Yeah, that's that's kind of like what I'm working through right now is trying to really refine an approach that I think could work for the next decade, you know, 15 20 years and then share with Google.
So it sounds like part of your process is to go through this and figure out what's not changing and try to allocate their do you also look at what do you where you see massive change and how you could possibly take advantage of that or
A category you just don't evaluate
not at not in that language. I I kind of tend to think about things that are just will they be more important and if they're going to be more important, how can we accelerate the right outcomes? I think climate change is a really good example of that where it doesn't matter whether you believe in climate change or not. I think that what we know to be true we don't like which is that, you know the places we used to ski at we can't ski at it.
Team or the places we used to go and bathe on the beach made disappear not exist. And so if nothing else just because of our own selfish desire to be happy. We should probably want to better control at least to the extent that we can our impact on, you know, taking our own happiness or so, you know, I don't think people in the midwest want, you know hurricane season and if there are experiments that we could run
Where we can observe whether they help we should run them. And so, you know, if you have all these gigatons of carbon being emitted and you can run an experiment that takes them out. We should probably do it and we'll know conclusively whether you know, it'll change hurricane season. So why not just run the experiment in an unemotional detached way but like, you know, if you view climate change in that lens, it's a multi-decade.
Decker trillion dollar opportunity, the the world's first trillionaire will be somebody in climate
change. Well, that's interesting. Well, as you were saying that I was sort of also thinking there's things that we value today that are going to be massively under or over valued in the future, you know commercial real estate strikes me as something that maybe maybe that's not going to have the same future as past. What do you think of that? And what are those Industries for you?
Yeah. I'll see something that actually makes me.
Little sad, but I think it's true. I would not view it. I don't view it as commercial real estate forces resi residential real estate. I would say it this way. I think that architecture will unfortunately have a lot less value in the future because of climate change now, what does that mean? Well, for example, if you look at some of the most Progressive countries in the world Europe on the climate issue,
And you look and you know again start to go back to First principles. Where is the carbon admitted? You know, where are the greenhouse gases emitted while it's overwhelmingly in cities and then you start to look at. Okay. Well, you know, what are some of the things that we can do to Electrify or to decarbonize and one thing that you get to is you have all this incredibly beautiful architecture, but it's completely dated and the amount of carbon that you know these heating systems these Water Systems.
Them's generate, you know getting stuck into these very intricate beautiful. You know, you walk by these piazza's you can cut this at these things have been around for 500 years and on the one hand you're like it's amazing. But on the other hand, you're like this is going to be really tough for you know, the City of Paris or Milan or Amsterdam to defend historic architecture in the face of also wanting to be carbon neutral and I think in the United States, it's also going to have some direct implications as well. So if
Really, you know, we unfortunately have to replace some of these old beautiful stuff with more simple modern stuff. You know, we'll have a more utilitarian landscape or maybe you'll just have a bunch of variations of modern but you know, that's a direct implication of climate change. I think that nobody talks about so, you know, how will that affect people's happiness or people's creativity that they're all living in these sort of like, I don't know if you've ever been to Shanghai, but if you cross from you know put on to Shanghai we go across the sky.
Unlike Bridge it sort of looks like this kind of like weird future state where you just have these, you know buildings rising up every single, you know to the Horizon on each side. They all look the same and you think God that's depressing if I had to live in that but we may have to live in that in a you know climate neutral world. Do you want
that? You said successful investing is about behavior and psychology. Can you expand on that?
I think that
When push comes to shove what you're always going to be fighting as yourself panicking overreacting under-reacting refusing to observe the present living too much in the past wanting too much to believe in the future. So it's all psychological traps because the data is there if you want to observe and then just clinically re underwriting how it's it's you know as part of your risk equation, which
Bucket, does it sit at how big is that little back inside the bucket? And so I try to really understand how to create an edge and I don't think an edge comes from, you know, attending conferences or you know, writing some crazy algorithmic software maybe a few people can do those things and find an edge. But what is a more kind of like mainstream accessible idea and I think it is that if you define certain behavioral principles
Suppose that protect you from the worst parts of your own psychology. That's a winning strategy. And so, you know, I have like a handful of these rules that I try to live by and they these behavioral rules around, you know, trying to think about things like buying companies versus buying stocks the trying to think about, you know, the quality of the CEO of the quality of the business trying to think in long duration not looking at the stock price every day, you know reading annual reports of
Waiting quarterly reports, you know, all these things that try for me to solve for my blind spots and that's allowed me to take bigger and bigger swings because I feel like I'm practicing the things that will protect me from myself. So I think a lot of what you know you need to do as a person is by the way notice how all these things tie together. It's like, you know, nobody would have ever told you that
Focusing on your happiness would make you a great investor, but focusing on your happiness and part of saying, you know, you're exploring who you are as a person you're finding what makes you happy, but the other part of that is you're finding out what blind spots are in your weaknesses right in your finding ways to deal with them. Well when you translate that knowledge of those things into business particularly, you know in investing think it's enormously helpful. It's a money-making strategy. So I really I really think that spending time understanding yourself and then Translating that
That into actionable guardrails that can write down and you stick to his a really important thing.
I love the idea of sort of creating these correct automatic behaviors that put you on the path to success by either addressing your blind spots or sort of like showing you more are there other sort of like personal rules that you have as well or they're like it let's let's go deep on that. Like, what are you do too?
Become your blind spots in all areas of your life. Not just investing but personally to
I talk and again I go back to the same thing. I just I just talked I know what I feel but I find that I revert into a comfort zone where I'm repeating past behaviors that I don't like it's because I've stopped talking to not to a couple of friends that I rely on to, you know to therapists that I talk to on a regular basis. It's all about my mental health
The healthier I am mentally the more I'm able to overcome these natural inclinations to revert to comfortable patterns that have been very well established and well-worn. They're not healthy, but they're just habits, you know by talking what happens is people who know me, they develop a pattern recognition and then they start to tell me. Hey, you're being really insecure there. Hey, why are you know?
Talking in that way or talking about this thing. And now what I can do before I would get very defensive and insecure and I would attack the person when they would say that so it also needs people who really deeply at the end of the day. Love you and care about you and that's hard to find. I mean, it's not like those those folks really grow on trees. I have two people not my friend Rob and I really talk to them a lot and then I have two therapists.
And I talked to them weekly and so that's really helpful for me. So yeah, it's just pattern. It's just their pattern recognition, you know talking is also really good because I can't allows you to vent. And so, you know, if you think about sort of like plaque, you know, flossing doesn't stop 100% of the plaque from building up but it does prevent, you know, 90 95 percent. So then when the dentist gets in there, you know, she's only your he's only cleaning out a little bit muck and mire versus like all kinds.
Just grab that shit. And so for me venting is like keeping, you know, the platform building up with stripping away the plaque. It just allows me to get the negative energy out to reframe some of the things that are happening in my life in a more constructive way and then I can come back to the problem at hand with the healthier mindset and Outlook. I just I really think the big Insight the big unlock is it's not work and personal. I don't think these are separate worlds.
They're deeply subconsciously intertwined and interconnected and being happy personally is the pathway to help everything else makes sense. And that is around mental health and I think the key unlock for mental health is just finding a resource to talk to and when you first start talking it's going to be just kind of blathering bullshit and it's going to be imprecise and it's going to be super awkward and you're going to feel
Like what is this? And then over time? It's like anything like when you start to get good at it as it's really good
you need to exercise that muscle you mentioned pattern recognition. I thought that was really interesting. You've interviewed thousands of CEOs over the years. What are some of the questions that you asked and the patterns that you recognize and how do you develop that pattern recognition to find the ones that are going to make the biggest difference
I've learned that my pattern recognition before was too brittle
It was too superficial. I would ask dumb obvious questions for which any good CEO will have very good practice dancers. And so now I don't do that anymore. I'm trying to solve for something a little bit more elusive, which is two things integrity and mental agility. The Integrity want can't be defined by a question. It's about subtle observations over a long period of time because people take a long time to reveal themselves. I'm going back to how we first started.
People are very good at lying and being evasive very good and I don't mean to say that in a negative way that you can't trust people you absolutely can and I actually think the way to overcome all of this stuff is to actually put your trust out there and just trust with reasonable guardrails, but to trust and just to assume the best intentions of everybody. I think that's a very healthy mindset. It just d escalates a bunch of mental stress that you could otherwise have but people reveal themselves in small little ways over long periods of time.
When you can observe enough that those observations you can pull them together to get a really good sense of Integrity so that you know for me it's like a two three four six months nine month one year journey and every moment is an opportunity to just re underwrite my integrity and there's you know, am I being completely whole and honest to them and am I giving them my best you know, so I'm like am I leading in with a hundred percent of my integrity and then are they getting it?
Back to me and it doesn't have to be in a business interaction. It could be in a personal interaction. It could be how they talk to the waiter at a restaurant random conversations you have in their reactions to things their openness to different points of view. So that's one thing and then mental agility is just more about what happens when you keep things open ended that's not what you would do. If you were interviewing someone for a very specific role at a company like, you know engineer something, you know, they're there it's about
competence and these three things don't matter but when I'm evaluating a CEO, those are the only two things that matter and so it's about a bunch of open-ended conversations where you see how they think and you know, when you see how they frame a problem and when you ask kind of seemingly dumb questions, and if you're okay to ask what sounds like a dumb question and what they actually here is a very open-ended question and that's a great way to sort of figure out mental agility because
It sparks then how their mind works and you hear an answer that you would get otherwise and what you hear is a framework a process and and I really like that, you know, like meaning like when you frame questions like so what do you think about and you just say something like random even just like randomly, you know like Jim. What do you think about the triangle office? You'd be like what the hell kind of question is that like that has nothing to do with what I know and then you know
Just find people's mental agility. And I asked I think CEOs are incredibly the best CEOs are incredibly mentally agile people. They're kind of curious. They know, you know a little bit about a lot. You know, that's how you have to run a company. It's no little bit but a lot and you have to be good at engaging in understanding things asking questions back. You know, what what what about the triangle offense asks, you know makes you want to ask me that question and then I would say well I just think it's like what do you think about sort of like, you know structured approaches that have
This sort of like Dynamic allocation of like, you know of resources. So like, you know, the triangle offense to me is like this kind of like really cool way where you I like both have rigidity and flexibility and then you know, then you may say yeah, you know, well, here's a way that I think about my business that way and all of a sudden you're having a completely random conversation. It required me to say something completely fucking dumb and like what seems like a complete non sequitur to to the average person and then the intellectually mentally agile person in out of you know, mostly out of kindness and curiosity.
Engages you and then you end up down a totally different path. That is a great way for me to catch a
cassia. I like that a lot. I'm glad you didn't put me on the spot with the triangle offense.
I mean, I was just making it up right away. That's David. Yeah
talk to me a like a public company CEOs. Who do you think is the sort of like top five public company CEOs not asking for investment advice here. Just who are the best pure CEOs for the next 10 years?
Okay, Elon Musk.
Jeff Bezos passing really? Okay, you're really putting me on the spot.
I love it. I get you thinking.
I'm really thinking to try to answer this in a super thoughtful way Toby Toby Toby looky. I think Toby's really really exceptional phenomenal. He's world-class on the level of those two like eyes and such a good guy. Wow, I've never been asked it. So well Jack Dorsey.
Exceptional and I really owe him actually an apology because I had a very dismissive sensation of Jack and I don't really know him that well obviously but it's just that just in my observations of sort of his decision-making particularly at Square particularly around cash app and you know the decision to you know, the the idea of moving to Africa is just so smart. So genius, I mean just go
To show you the short term mindfulness of these folks that overreacted I think but Dorsey, yeah, that's for right. Yeah. That's for
Jesus
Toby Jack Dorsey screws Toby Jack me
which company
I will eventually have something that represents the totality of my intellectual Capital. We need like
you're going to go public I
would really like to I would like to be under that pressure and I would really like to work on behalf of everybody everybody meaning like, you know, if I can level the playing field and give folks but I don't know what that is. He that that's the problem like I don't know like how to answer that question, right?
It's like some amorphous blob. Like what is it that I do? I don't know what I do.
You can go public tomorrow though. Why don't you
but I think I'm pretty good. Like I really do think I'm good. And I think I'm getting better.
I'll talk to me about that. How do you measure the difference between good and like getting better for
yourself? We all like asymptotes at some at some trajectory and I think that I am now one.
To one-and-a-half orders of magnitude away from my asymptotes so you can kind of see it but it's very faint now, I think I have a toolkit to implement a process that can get me close to my asymptotes and I would love for me to be able to talk to you in 40 years. I'll be 84 and say I'm like within a couple of turns of the asymptotes, so
For me, it's it's believing in myself more. It's knowing how to take smarter risk being risk on in larger Quantum so I can write you know hundred multi-hundred million dollar checks now and feel okay about it. I need to be able to do that with billions and tens of billions and it sounds crazy but five or six people in the world really know how to do that. Well,
it's not it's not a shot that a lot of people get a chance to take, you know, even if you're running like the largest private Equity Fund in the world the quantum's of money that people are investing that is that is of their own still relatively Limited in small, even if the you know, the headline numbers are big. So I want to learn to do that. I want to learn to feel like less of an imposter the more I do that. I think the smarter I can get at distilling and observing the present acting on that and then passing that through to other people so that they can act on it too.
And so, you know, I don't have the skill to go deep in one of these things and you know build one of these platforms. I think my skill is slightly different which is sort of to organize a lot of things together in a thematic understanding. This is where I think at like, I can't be a CEO of a million dollar or a hundred ten million dollar hundred or even billion dollar company because that's about functional competence. But when a company becomes 10 billion dollar plus it's all about capital.
Action and I really think just I'm an outlier in my just maniacal desire to be really good at that so I would want to bet on myself. So but that's not an accurate answer your question because you said public company CEOs and it's not so I'm not
public. I thought you were just gonna break that you're going public right here on the show.
No, no. No, I have no plans but ya know that whole whatever. Okay, so let's take me out equation. That was stupid. Well, no, see that's me being feeling like an imposter lock seams here. I mean like it's like
What a it's a
it's you're overthinking this.
Yeah, it's a coping
that what what what is your decision process for when you're making an out Capital allocation decision. They've made a few recently like without any specific names to I don't want to get anybody in trouble. But what's that process in your head? Like like, how are you actually what's what are you talking to yourself about mentally to make sure because it's all on you.
Yeah, I I really love it. Like, you know, we do a lot of work like I mean
I have great Partners. I have a team that I work with who are just exceptional people. They are the most high integrity people I've ever worked with and they give me enormous energy. I have some some, you know folks that I partnered up with who have their own organizations as well. Those folks are super high integrity. And so all these people that I spend my day with every day are just kind good Earnest people.
Each of us. I don't think are the smartest ones but when we put ourselves together, we are really really smart Collective and that's that's awesome. And so we all do different things and everybody's bringing different things to the table. And then what happens it allows me to kind of synthesize all kinds of different inputs and learnings, you know variations on a Model regulatory research market research, you know consumer marketing research all of this stuff and learn about it, which is super fun.
And in my mind what's happening is basically like here's how this can go right? Here's how this can go wrong. Here's how this can go right? There's all this can go wrong in a bouncing back and forth and all of these things are just oscillating and if I had to characterize it this is gonna sound nuts, but it's like a and then that oscillation goes faster and faster and faster and then I find a point of equilibrium
that like the Matrix moment for you or like all of this data all of a sudden just
yeah. I know. Yeah.
Yeah, it is like that. It's like, you know, I know that leading into something I become.
A little detached. I am a little all over the place. My mind's racing my you know, so sometimes I'll be saying non sequiturs on calls and my partner's are very patient with me in those
processes. You've made like the public calls you to Bitcoin in 2012. You did Amazon or 2014 you did Tesla and 2015 like you've nailed fairly I would say controversial things.
The moment I mean in hindsight, they've all worked out exceptionally well, but at the moment they everybody thought you were crazy.
Yeah, they were really really did
and that's awesome because it's like advantageous Divergence right your diverging from the crowd and you're right.
Yeah, and and and what it does is it can has given me confidence in my process.
It's random, you know, it's about ingesting a lot of stuff. It's allowing yourself to be influenced, but then come back home, right? That's another thing. I love meaning if I'm having a conversation or in a sort of a teaching kind of a situation where I'm learning about something. I allow myself to be seduced. I allow myself to sort of fall for the narrative. I allow myself to believe the totality of what that other person believes fully and completely because I want to really start to understand the nooks
and
crannies now that process doesn't work if you want to be intellectually lazy or if you find yourself being intellectually lazy and you stop when you get you know, confirmatory that first confirmatory meeting or that first confirmatory article or you know, you could joke but like that first confirmatory Googling I've done, you know, it doesn't work that way, but if you're willing to bounce around
And you know fundamentally be unoffensive in your opinion upfront you find that people who have extreme opinions will talk to you in a very unguarded way and I think I've trained myself to let myself be seduced by those folks so that I can learn from them. But I always come back home. I come back to the center. I come back to no opinion.
What's the trick for that right? Like there's this quote from Ender's Game that I was thinking. Have you ever watched that movie or read the book where he
Is there's this moment where I understand my enemy better than they understand themselves and in that moment, I sort of love them and defeat them and it sounds like you're allowing yourself to understand. Somebody else's opinion like so fully.
But you don't get caught up in it. How do you avoid
know I do in the moment, but I know to slow it down and then I also know to come back home. So I think I think maybe the maybe the clarifying question. Jane will be like, what is your process of coming back home? Okay. So what I have to do is I have to go and then be again, it takes it none of this is possible without an incredible team that has super high integrity the anchoring.
Of which is kindness. So I will come back to my partner's I'll be like guys. Wow Zach. Yeah, and they're like, okay. Okay. Okay. Okay good and they they D escalated, right? So, you know or I'll go to next she's like, okay, I got you. Okay. Okay. Got it, you know or robbed or you know, like all these and so it's wonderful.
Awful, and so then I go okay. I was getting a little excited there or I come back. Can you believe this? I can't believe this what that is. This sucks man. You're like, huh? Okay. Yeah. Got you good. Okay, and you know, I'll I've learned that I do that and so I can get back on faster and it helps me but but I do that a lot. I allow myself to live in the Persona of that person and that opinion.
Because it allows me to understand where they're coming from.
That sounds like a superpower man, like just to be able to understand it. Somebody's level without bringing any of yourself into it and just be like, I really want to see the world through your eyes. I'm sure you're everything. I want to feel what you feel. I want to see what's valuable all the variables. I want to see how they connect but the way that you see the world and then coming back and then saying now I can see the world through this person's eyes and my eyes I have fewer blind spots. I have a more
Or more accurate view of reality if you yeah. Are you still are you still high on bitcoin?
Yeah, really? Yeah, I just think that you know, I think that we are dismantling Financial Orthodoxy and in that dismantling and in the leveling of the playing field, there will be moments of volatility.
And to have a small amount of insurance that's uncorrelated to the Orthodoxy. I think it's just the smart.
Risk management thing. I don't know. I'm not super emotionally caught up in it. And now it's not like I'm cheering on the failure, you know central banks and like I'm not decrying all the money getting printed. I'm not that emotional that stuff but I just think it's smart thing to have under the mattress just in case
how do you think about all this spending? I mean we're every Western country is about to basically, you know spend themselves into I don't know what position but they're going to spend more money in the next, you know, 10 to 15.
And they probably spent in the past hundred and a lot of it on the surface and I haven't looked into this as much as you have but a lot of it on the surface seems like we're going to prop up the status quo instead of investing where things are going in the future, right? So I know some countries are writing checks to people to stay at home, but they're not requiring them to adapt to new skills that will be valuable in the future. They're sort of just propping up the way the world used to be. How do you think about that?
Yeah.
II think that
fortune check me like am I completely wrong
I think in part it's not totally true what you're saying meaning like, you know, if you look at sort of the EU budget an enormous percentage of that budget is going to you know, a carbon-neutral be you buy 20, frankly, not even 2050. They're trying to pull it forward and do it 2040 in some Industries in 2030. So I think the spending is actually going
In reasonable places, I think that there are there's always waste and the reason is that you know, politics and political bodies don't know enough to write specific legislation. So they get influenced by all kinds of folks. And so that's what creates waste and so you have to be okay with that. It's just a natural Dynamic of democracies and you know the waste we deal with the waste because in return to get Freedom, you know different kind of Freedom right there. I mean like, you know, maybe you can have the most you know
Coefficient thing and country in the world. But if it's autocratic, you may not want
that. You also don't want super efficient countries, right? Like we've learned this we want resilient companies. We want resilient countries. We won't resilient people and I think this this focus on hyper efficiency also had us, you know manufacturing PPE in certain locations and not having a national stockpile and you know, we've done this in a lot of ways where we've seated,
This redundancy or actually we're taught this in school like business school teaches you write like redundancy is a waste and you can turn that waist into capital. And so we become hyper efficient.
I agree with you just with a small to business school as an example has taught you that redundancy is waste and waste can be converted into profit and profit is converted into compensation. And I think that is what people have really drank the Kool-Aid.
You later. So, you know when they ran out of waste that they could convert into profit. They had these Ultra quote-unquote efficient companies and then they just redirected, you know, the middle part of that equation to generate more compensation, which was like, you know, okay. Well we've eliminated all the ways. We've outsourced everything to China were generating more money than ever now. What should we do? And then people said, oh, we'll just start to buy back the stock and that'll also Drive compensation, you know, these things these things
I
think our cycles that that all flow from the incentives around complim fortunately that just I just wanted to pay I know I thought that was those.
Excellent. Do you think government should bail out public companies Industries, which ones
I think that the government should really be plowing money into the next generation of Industries. And I think that the government should always be on the bleeding edge of not needing to make money.
In some critical important industries for the future and so in the absence of doing that we've lost touch with the things that have really propelled the United States for for example, you know, why was the Space Race so important, you know on the one hand it was about, you know, American determinism, right? Like we are going to do this this is going to happen, but it was also that it created an entire generation of industries that will derivative from the space industry because you were training people with a level of skill and precision and capability to think of that.
In other markets, so we always need to be in space. We always need to be pushing the boundaries, you know, we need to go, you know, not just to the moon but now to Mars and Beyond it can't just be you on task. That's not fair, you know, you put him against the wall and he's got a raise an enormous amount of capital that you know, if we had government sponsorship for we could have we could have done a lot more sooner in many ways. You know that this deflationary supercycle really started in 1970.
When we basically ended the space program and it's in the early version that's always kind to them. So I think that you know, that's a really big thing. That's where that's where I think like, you know government should be spending their money. They should be making bold bets on other markets to like, you know climate change or they should be changing incentives around, you know Healthcare they should be changing incentives around education, you know, if you're going to spend money, you know, why don't you just like that all student at I don't think it's such a bad thing and in return make people
Joining some sort of like American piece for that kind of like does work and volunteers and there's all kinds of ways that that governments can allocate Capital probably a little bit more productive
like that. I'm going to switch gears and start asking some of these Twitter questions so you can you can answer rapid-fire if you want of all the provocative and controversial things that you've said, which ones do you regret? Not what do you think future trimethyl disagree with?
That you agree with today anything come to mind that you're sort of on the edge of
it now, but if I'm if I'm evolving I will have learned so much more that my thoughts today will seem slightly immature. And
what's the last thing you change your mind about
all my gosh three or four things just today.
What do you think of the entire Venture Capital industry
well-intentioned somewhat misguided?
Somewhat low Integrity in certain places misaligned
is this work from home thing real and what are some of the implications?
It's partially real and I think the biggest implication is belongingness community feeling part of a group. And so I think when we can go back to the office will want
to I think one thing that we miss on this.
That we like to feel part of something larger than ourselves and that's become harder not only in our communities in some ways. I mean in some ways it's easier because we're all going through this common struggle, but we're also it's harder in our community and we don't feel like even though you're working for a company or you working with people. It doesn't feel as much and I've noticed a lot of people have started saying well it's becoming really transactional now, I don't see people at the office and ask about their weekend anymore. It's becoming very sort of I think that's really interesting sort.
Of observation.
I think that's well said I think that's a really important thing. I agree. I completely agree
with you. How do you manage risk?
I mean, I have a I have a framework. It's basically a barbell, you know, a big chunk of the liquid bets that big chunk of very concentrated liquid bets and then a slug in the middle. That's just more kind of like random
cash or the S&P 500 for the next five years.
Specific color
you had something about why men live less long. Do you remember that on Twitter?
Yeah. I tweeted something out. What was that
didn't have something to do with like we couldn't talk about her emotions or something.
Yeah, he has to do with mental health and emotional. I really do believe that. I mean, I think that you know, like but while coming just ask the question, why do women live longer than men?
Why do women live longer
that there are why I mean why why
I don't know. I think that there's something to the fact that they're able to talk about feelings in a way. That is unnatural for men
100% I really think people think this is like a crock of worship. I don't but I think that your physiology is not just how your lower intestine processes blah, blah blah, like that's not what it means like
The body is like a very complicated combination of emotions and you know cells organs and all of these biological psychological functions interacting and we've all seen that play up and so, you know, it's like it's inconceivable that your mental health doesn't improve your health. I mean, right. Yeah like you do you sound like an idiot if you said that and I just think that dude
is don't talk and it's a little bit stigmatized and it is for wind and I think that that's a wonderful super power that women Could Teach the rest of us my I'm like I said Partners taught me how to talk and I will be eternally grateful for her for having taught me that
next question. What are some of the lessons you learned from the book The adult children of Alcoholics, which you recommended a few times
the most important one is how I was normal.
And it's again. It's pretty obvious or not obvious, but may sound Bland but like, you know to feel so deeply insecure and somewhat of an imposter my whole life always The Outsider, you know, that's the first book that said, hey, there's an entire group of people that will behave this way based on these inputs and I was like, wait a minute. I behave those ways.
Wait, you're telling me that I'm not this deficient broken person that I'm a by product of this and this is well studied and it's like it's actually normal and you can improve where you are was it was a profound moment.
All right. Last question. What's the most? Mrs. Miss valued asset in the world today?
Either high or
low. This is really good question. Okay,
you can pick most undervalued or most
overvalue. Oh my gosh. Wow. See I really take these questions. Seriously when we love is that I want to know but I want to give you like a right answer and I don't really know I had you
can just say I don't know. I mean,
yeah, I don't know. I don't know. I don't know how to answer that question. To be honest with you. It's a really good
question. I love that the video thing we just started doing this.
I can see the wheels turning in your head. I love it. This has been an amazing conversation to mouth. I want to thank you so much for taking the time.
Thanks Ben. I really really appreciate it. Thanks for having me.
Hey one more thing before we say goodbye. The knowledge project is produced by the team at front of Street. I want to make this the best podcast you listen to and I'd love to get your feedback. If you have comments ideas for future shows or topics or just feedback in general. You can email me at Shane.
@f s dot blog or follow me on Twitter at Shane a parish. You can learn more about the show and find past episodes at f-- s dot blog / podcast. If you want to transcript of this episode go to f s dot Blogspot tribe and join our Learning Community, if you found this episode valuable share it online with the hashtag the knowledge project or leave a review until the next episode.
