“When asked what the deadliest shark is to humans, most people will say the great white. The lasting influence of the movie Jaws, reinforced by dozens of pop culture references and news reports, keeps that species of shark at the top of the mind when one considers the world’s most fearsome predators. While it is true that great white sharks do attack humans (rarely), they also leave a lot of survivors. And they’re not after humans in particular. They usually just mistake us for seals, one of their key food sources.
We must be careful to not let a volume of survivors in one area blind us to the stories of a small number of survivors elsewhere. Most importantly, we need to ask ourselves what stories are not being told because no one is around to tell them. The experiences of the dead are necessary if we want an accurate understanding of the world.” – Farnam Street
“Wealth is the thing you want. Wealth is assets that earn while you sleep; it’s the factory of robots cranking out things. Wealth is the computer program running at night that’s serving other customers. Wealth is money in the bank that is reinvested into other assets and businesses.” – Naval Ravikant
“We’ve learned this year that assumptions you have about the future can be destroyed overnight. That’s true for the poorest to the most successful, the old dry cleaner to the tech startup. It was true in January, and it’ll be true again in the future. Things change.
If that’s the lesson, the question is: what do you do about it? How do you think about a world where fundamental assumptions about the future are so fragile?” – Morgan Housel
In two recent episodes of Jocko Podcast, Jocko and Co. discussed MCDP 7 – a new Marine Corps publication describing the learning philosophy of Marines. While the MCDP 7 document is written for Marines, it is packed full of powerful, easily applicable lessons. Whether your a student, athlete, musician, academic, business professional – you name it – you can learn something from MCDP 7.
The Jocko podcast episodes do a fantastic job of unpacking MCDP 7 in detail and translating it for use outside of the arena of war, albeit over two long episodes. While we strongly recommend taking the time to listen to them and read the full MCDP 7 publication, we want to emphasize the importance of the first chapter, The Nature of Learning. There are easily 15-20 lessons in this chapter alone, but we created a condensed list of our five favourite takeaways that can (and should) be utilized by everyone right away.
1. There is more to learning than reciting information.
Learning involves mental, physical, social, emotional, and other factors that are learned in both formal and informal settings. The learning process is divided into training and education; Training is the learning-by-doing component, while education involves studying and intellectual development. Both elements are critical to learning success.
2. Gain the “intellectual edge.”
Combining knowledge and experience will improve problem-solving, mental imaging, and other cognitive competencies that enable faster and more effective decision-making – even under time constraints or when exposed to imperfect information.
3. Enhance your memory.
Technology is a valuable tool to master, but it isn’t failproof. Relying solely on technology can backfire when time is of the essence, or when the technology malfunctions. The mind must be able to recall the necessary knowledge instinctively in high-pressure scenarios, which requires consistent practice.
4. Learning is hard. Don’t make it harder.
The learning process can be a difficult one, and a lack of self-awareness, humility and time management will only make things worse. To be a better learner, one must better understand themselves.
5. Learn vicariously.
Learning by doing is required, but don’t underestimate the importance of learning through others by reading or otherwise studying their experiences.
These takeaways are just the tip of the iceberg, so be sure to read the full MCDP-7 publication (download link below) and listen to both Jocko Podcast episodes (embedded above).
Each is quite insightful, but one that particularly stands out is #4, experiment. Trying new things, routines, and approaches can help discover better and more efficient ways of doing things that can help ease the sense of being overwhelmed. It can also be said that experimentation can add some excitement and perspective to a situation, which can lead to a much-needed momentum change for the better.
If you are interested in learning more about these principles to see how you can apply them to your life, check out Zucker’s full piece on Forbes or picking up a copy of Wedell-Wedellsborg’s book.
Note: this lockdown has really spurred some ‘out there’ thinking, for better or worse.
So yes, aliens.
Last night’s episode of Joe Rogan featured Tim Pool, and part of the conversation was around aliens. Some intriguing ideas were being discussed that conjure up a mix of laughter, doubt, and bewilderment. Whether you believe in aliens or not, there is no hard, undisputed evidence to prove either way. The fact is, we may never actually know the answer. Given this, is there even a point to thinking about aliens?
While our brains may not be able to completely grasp the concept of extraterrestrial life, thinking about such complex topics might still be a good exercise. Even if we disregard the question of other life outside earth, there are still other planets, stars, galaxies, etc. to consider. Taking time to sit and think about this can be a humbling exercise in perspective.
There is a whole lot more going on out there than just us. Reflecting on such unfathomable topics like aliens and space can really make one feel foolish when thinking about all the petty and insignificant things we dwell on every day. Also, thinking about problems with so many unknown variables can be an excellent exercise in critical thinking, problem-solving, and creativity.
“I’m sure the universe is full of intelligent life. It’s just been too intelligent to come here.”
Arthur C. Clarke
So if you ever need a fresh dose of perspective, or just need to jump-start your mind, go ahead and think about aliens. No judgement.
At the very least, it will help pass the time during a global lockdown.
The future is unpredictable. We cannot predict any future event with 100% certainty, although we can use past experiences and future expectations to infer potential outcomes. Even this has some risk involved since we cannot estimate all possible results in a world full of unexpected and random events. Most of us disregard the inherent uncertainty involved in the decisions we make and instead choose to believe that uncertain events are predictable. We see this in financial markets all the time when amateur investors think they can accurately predict future stock prices. Any unbiased and rational person would agree that this is a prime example of an uncertain outcome, yet many of us foolishly believe we can predict it with certainty.
The essence of investment management is the management of risks, not the management of returns.
If something is unpredictable, does this mean we should avoid it? Not at all. We should instead be welcoming it with open arms. Once we accept that we cannot predict the future, we can make better decisions in business, investing, and anything else – which is where risk management comes in. The entire premise of risk management revolves around knowing that most outcomes are out of our control, but by strategically managing our risk exposures, we can favourably affect the probability of beneficial outcomes occurring for us.
Risk management goes beyond business and investing. It’s fundamental to the decision-making process of all humans. Contrary to popular belief, risk management is not risk aversion. It’s about strategically managing your portfolio of risk exposures and deciding when, how, and how much to spend. Just like with money, reckless spending of risk could result in unmanageable debt burdens, overwhelming failures, and other undesirable consequences. That said, merely hoarding risk units without spending or investing them in potential return-generating opportunities will severely limit the ability of an individual or a business to grow, and ultimately maximize the returns on their risk. Risk management isn’t static, however. It continually changes based on circumstances. Like their investment portfolios, the optimal risk portfolio for a student will drastically differ from that of a retired senior based on their different stages of life.
If you are not willing to risk the unusual, you will have to settle for the ordinary.
But before we can manage risk, we must understand it. Risk is one of the most valuable assets any person, business, or other entity can possess. You can buy anything with risk if you have enough to spend. The more you are willing to pay, the more potential returns you can buy. Unlike many other tangible assets, its value almost always holds. It’s rare to see a high risk-low reward or low risk—high reward opportunity. When they do pop up, they quickly disappear. The former would become obsolete from lack of demand, and the latter would be capitalized on by arbitrageurs before immediately disappearing. For the most part, there is no free lunch when it comes to risk.
Strategic and intelligent thinking about risk can make a big difference in the decision-making process for businesses and individuals alike. Risk management involves actively controlling risk to achieve our goals. Once we have a clear understanding of our risk portfolio, then we can decide how to maximize the returns on a risk-adjusted basis. But it all starts with abandoning the fallacy of predictions and embracing the power of risk management.
If you don’t invest in risk management, it doesn’t matter what business you’re in; it’s a risky business.
The battle within our mind is a continuous and unrelenting conflict that must be won every day. Without winning this fight, one cannot expect victory in any other aspect of life. Even the most formidable and technically gifted individual cannot devise a winning strategy in business, politics, sports, or any other environment if they cannot master themselves. Emotions and impulses bend our perception of reality and cripple our rationality, which severely hinders the mind’s strategic capability. The more we let emotions dictate our actions, the more vulnerable we are to defeat. Great strategists throughout history have understood this and have been able to use it to their advantage.
Strategists take a pragmatic approach to conflict, and their mastery of mind and emotion allows them to accomplish their objectives in even the most hostile situations. Even in the face of insults and aggression, the strategist will parry these attacks and maintain composure. Rather than engage in the hostility, they will seek to interrupt the attacks through delay, obstruction, and misdirection. Letting the other side waste precious time, energy, and resources on emotionally driven tactics will eventually tire, frustrate, or demoralize them – causing them to unveil a weak point in their strategy. Time is a great advantage in conflict, but one that can only be utilized through a rational and disciplined strategist.
In his book, The 33 Strategies of War, Robert Greene makes a fitting comparison between two key figures in Greek mythology: Ares and Athena. Ares, the god of war, was a quick-tempered and ruthless warrior known for his lust for violence and brutality. He was hated among humans (except Spartans) and gods alike and considered untrustworthy due to his reckless and wasteful approach to war. Athena, on the other hand, was known as the goddess of wisdom and war (among other things). She represented the intellectual and philosophical side of war that Ares failed to master. While Athena was a powerful force on the battlefield, it was her craftiness and rationality that helped her defeat aggressive and impulsive enemies. There are countless stories throughout Greek mythology of Ares suffering defeat, but Athena never lost a battle. With this in mind it is clear that the superior general is Athena, so why then do so many follow the Ares approach to conflict?
Channeling Ares comes naturally to us. Ares lies within our animal brain that reacts to our environment at a faster speed than our rational, “Athena” brain can. It takes time, discipline, and determination to tame our impulses and emotions. Unfortunately, most people are unwilling to make this sacrifice and instead choose to repeatedly shoot themselves in the foot by giving in to anger, greed, pride, or any other emotion. We see this in sports when a player takes an undisciplined penalty that costs their team the game; in financial markets where investors recklessly buy overpriced assets that blow up their portfolio; and in marriages where spouses hurl insults at each other that turn a small disagreement into a relationship-killing fight. We have all been in situations where we have given into to our primal instincts and ultimately cost ourselves a chance at achieving our long-term goals.
In the end, brutes may win battles but strategists win wars.
“When there is no enemy within, the enemies outside cannot hurt you.”