Mental Tips, Tricks & Lifehacks, Vol. 11

0:00How do you decide which AI stock to look into and on which ones to take a pass? What do you believe that most people don't believe? And can you do this trick that apparently 25 % of Americans can, but 75 % cannot, and it just takes one afternoon to learn? It provides you a lifetime of entertaining little kids? It's worth it. It's time for the 11th episode in one of my favorite recurring series on Rule Breaker Investing, and that's Mental Tips, Tricks, and Life Hacks, Volume 11, this week, only on Rule Breaker Investing. It's the Rule Breaker Investing Podcast with Motley Fool co-founder David Gardner.

0:50And welcome back to Rule Breaker Investing. A delight to have you joining with me This week, we're going to have some fun together Let's get smarter, shall we? It's the latest, it's number 11 in our historical running series of mental tips, tricks, and life hacks The series started with volume 1 on June 15, 2016 The most recent was November 2024 I counted them up In the history of this series, I've now shared 74 mental tips, tricks, and life hacks over 10 previous episodes with pretty much no repeats. Now, if you find your curiosity sparked by anything I share with you this week and you want to go back and check out that series, well, www.rulebreakerinvesting.com has a pretty great tab.

1:37It's the podcast tab up top on that page. And if you click it, you'll be dropped into a page that has all of my previous mental tips, tricks, and life hacks episodes listed in order. which is a lot easier than going back through Apple Podcasts, Google, or Spotify and trying to locate an episodic series. So one of the great things about RuleBreakerInvesting.com is that podcast tab. And so whether it was last week with my blast from the past or other recurring series, they're now all conveniently organized for you if you want to go back and binge listen to any of these series, including this one.

2:15Also, Games, Games, Games doesn't have to be just once a year on this podcast for December, what are some recent board game recommendations I have for your summer for games that have come to my table repeatedly in recent months? Now, before we get started, let me ask, are these earth-shattering, life-improving, unforgettable tips? Absolutely not. Well, maybe in some cases, but these are mainly just hacks, A lot of life hacks. This series is designed to make life more elegant, fun, and navigable. And I'm coaching you very explicitly here. Like any good life coach might do, I'm aiming most of all for your success.

2:56These are things that have worked for me that I hope work for you too. And they can be quite small. By the way, like in Volume 3 from March 2017, when I suggested you stop taking elevators most of the time. You're going to get where you want to go quicker if you just take the steps You're going to get more healthy steps in if you stop taking elevators Now obviously if you have luggage or a huge climb Feel free to take the elevator All that and 73 more are in the past But that was then and this is now So let's just about get started But before we do I just want to mention That I grew up with someone from the age of 4 We went to nursery school together and I've admired him throughout my whole life.

3:40And he's one of those people who is just a winner. Somebody who went to Yale University, played basketball there himself, got a Harvard MBA, has gone on to do really good things in this world. He's running his own not-for-profit. It's called Management Leadership for Tomorrow. And I'm referring to my friend, John Rice. Again, I knew John when I was four years old and here I am at 59 and I was so delighted. He was standing there wearing a UCLA uniform, uniform number one on the front because his daughter Kiki Rice was on the national championship winning women's basketball team this past weekend playing point guard for UCLA in her final year.

4:17She's probably headed to the WNBA next, but I don't think John listens to my podcast, but I just want to give a shout out because how proud am I to have known John and his family? I haven't spent a lot of time with Kiki. I think I've watched her on television more than I've seen her in person, but it's just a reminder to me. It's so true of the stock market as well. It's a phrase I use a lot, drawn from sports. In fact, I say things, you've heard me say this before, I say things like, what do winners do? And the answer is winners win. They don't win every time, but they consistently win. One of the most harmful bad disclaimers you'll see anywhere is on financial television.

4:55You hear it all the time on CNBC, past performance is no guarantee of future results, and it's repeated constantly in many different forums. And that is almost always exactly the opposite of how you should be thinking about life. Past performance is maybe the single best indicator we have of future performance. Of course, you have to disclaim financially that you can't expect the results from that fund or that stock in the following five years that you got over the previous five years. But in my experience, what do winners do? Winners continue to win. And I congratulate the Rice family, especially Kiki, on a fantastic blowout win over South Carolina, winning the national championship.

5:37Okay, now let's get started with this week's podcast. Mental tip trick or life hack number one. This one is a mental tip. And if you've read my book, Rule Breaker Investing, this one might sound familiar. But under the assumption that not everybody hearing me right now on the podcast this week has yet read Rule Breaker Investing, and I'm always trying to get these ideas out to the broader world anyway, I want to go over my two simple tests I like to apply before I buy a Rule Breaker stock. I had the pleasure of being on a Korean YouTube channel that will air in the coming days or weeks, but I recorded that yesterday with a wonderful host.

6:15It was really in support of Rule Breaker Investing, which has come out in a Korean edition. So he's a big fan of the book, and we talked about the book, but he asked me near the end, with a lot of AI stocks coming out these days and more coming in future, how do you know which ones to pick? And I said, well, I'm glad you asked, because of course, everyone is talking about AI and mostly should be. And it's very understandable that you get excited about the possibility of investing part of your Nasdaq into this new industry, this plate tectonic shift in technology, the many industries that will be spawned by artificial intelligence.

6:53So how do we know which ones he asked to pay attention to and which ones not? And I said, well, let me tell you about my snap test. And so mental tip trick or life hack number one is the snap test and the cola test. And I did this for him and I'm going to do this for you right now in case you don't want to watch me on Korean YouTube. Here's the snap test. If you snapped your fingers and the company that you're looking at, the stock you're researching disappeared overnight, would anyone notice the next day? Would anyone care? And that is the snap test. It was made especially famous by Thanos, the Marvel villain who snapped his fingers and caused half of all existence, including many superheroes, to disappear at the end of one of Disney's great Avengers movies.

7:42but imagine if the stock you're researching, in this case, we'll just say the AI company that you're looking at, imagine if they disappeared. Would there be national headlines the next day? Or just within the industry itself, would people be abuzz? And really, let me add this in too, would they be deeply upset? Because all of a sudden, some capability or possibility has gone away altogether. And so you want to be generally researching stocks and thinking about putting your own money into companies that pass the snap test. Yes, lots of people would notice and many people would care. In fact, I strongly suggest that that is really what explains most of the great stocks of any given era.

8:28The companies that do such purposeful work, that reach so many people that add value to the world, to the lives of those of us buying the products and services of those companies. the great stocks are always going to pass the snap test. So if you want to know right away which AI stocks to think more about and which ones to ignore, I've just put forward to you my snap test. And let me close it out with the COLA test because these two things are related, but they're separate. They each work on their own. It's kind of about testing your gut and seeing what the world thinks of the company you're looking at.

9:02You already know the snap test. Here's the COLA test. If the stock or company you're looking at in artificial intelligence or any other industry, if that company were Coca-Cola, that is, they are the dominant brand. Everyone knows Coca-Cola worldwide. We've heard of it. And is that company the Coca-Cola of its industry? And if it were, can you find a Pepsi Cola? Is there another analog to what that company does? Is there an evident competitor? Does somebody else provide a similar product or service, maybe not quite as great or as well branded, but maybe, hey, tastes a lot alike. Is there a Pepsi Cola in that company's industry?

9:45And companies that pass my cola test, you can't find any Pepsi Cola when we're looking at that company. There is no clear competitor. Across rule breakers that I talk about all the time on this podcast over many years, Many examples come to mind, but I'll just give a quick one right now. Intuitive Surgical, which is the worldwide leader in robot-assisted surgery. They are definitely the Coca-Cola of their industry. And I challenge you to find any well-known, well-resourced, branded company that is anywhere close to Intuitive Surgical when it comes to robot-assisted surgery, which, by the way, is the future of surgery.

10:26In fact, it's not the future. It's the present. It's happening and has been happening for the last couple of decades. So this has been a 100-bagger stock for Rule Breaker listeners and members, one for me personally. And it's a great example of a company that brilliantly passes the COLA test. So now you know how I would decide which AI stocks we want to look at in the future and which ones we want to ignore. The ones that pass the SNAP test, if they disappeared, SNAP, would anyone notice, would anyone care? and the cola test. If they are the Coca-Cola, are you unable to find a Pepsi-Cola rival?

11:05Those two simple tests taken together help me save a ton of time whenever I'm doing stock research looking truly for the rule breakers, the great stocks of any generation. This one included. Mental tip number one, Snap Cola. All right, let's go on to number two. Number two is a trick. This one is pretty quick. I can get this one across very quickly. I've had a long time frustration in my household. Admittedly, I don't do nearly as much housework as other members of my household. I think most of all of my hardworking, amazing dear wife, who does a lot more around the house than I do. But one of the things I've tried to do over the years and be helpful is put dishes in the dishwasher.

11:49But are you like me? Sometimes you don't know whether the dishes already in the dishwasher are clean Just sitting in there having recently been cleaned Or whether they're the dirty ones where you can just drop your coffee cup Your used coffee cup right in along with them Now I'm quite sure some of you have already figured out this trick But I was this many years old, 59 When I finally discovered, thanks to a talented daughter-in-law of mine who has a good eye for things. When I finally discovered that for$10, you can go onto Amazon and you can buy a magnet that you affixed to your dishwasher, especially if it's metallic, and the magnet has a slider that either has the word clean exposed or you can flip the slider across it, at which point on the other side, the word dirty emerges.

12:43So all you're doing is you're toggling clean or dirty with a little sign that's on your dishwasher. And I wish I'd known about this, I don't know, maybe 50 years ago or 40 or 30 or 20, but I only just found out about it recently. And if you're just finding out about this for the first time and you find yourself similarly confused and frustrated in your own circumstance, I highly suggest you take me up here on trick number two and pay 10 bucks for the clean, dirty magnet that is so awesome and easily obtainable on Amazon.com. All right, let's move on to number three. Number three, I'm going to call this one a life hack.

13:25It is admittedly, there's a lot of overlap between mental tips, tricks, and life hacks. And by the way, maybe I should define my terms briefly. I view a mental tip as a mindset shift that's designed to improve your thinking. When I think about these things and I go over my list of seven, I'm like, is that a mental tip? Is that a mindset shift designed to improve your thinking? Or is it a trick, which I'll define as a clever shortcut that elegantly achieves a result, which is exactly why I called number two, the clean, dirty magnet, a trick, because it's a clever shortcut that elegantly achieves a result.

14:01Finally, I think we all know what life hacks are, but a practical technique that maybe simplifies your daily tasks, makes your life more manageable. Those are the terms. I probably should have defined them up front. But yeah, I think number three, I think it's a life hack. It's this question that I find myself fascinated by. I've been asking it aloud on this podcast the last few years, but I've never included it in this series. I found myself asking it of Kevin Kelly, the founder of Wired Magazine, who joined us just two months ago this week on this podcast. We had such a delightful conversation about the future.

14:34Kevin is my favorite of all the futurists. And here's the question that we kicked around. What do you believe that most people don't believe? And I put this forward to you as a life hack because in my experience, that is a wonderful question you can pull out at various different contexts or moments and really spark some interesting conversation. Could be around a campfire. Could be at the office water cooler. Could be at a cocktail party. What do you believe that most people don't believe? Talk about going one level deeper for almost any conversation, but not too deep. This is not an alarming question, I don't think, to ask.

15:15It's a very thoughtful question to answer. And on the podcast two months ago, Kevin took it up a notch farther. He said the question he likes to ask is, what do you believe that most peers of yours, whom you respect, don't believe? So very similar, but maybe one notch forward, because we're not just talking about most people now. We're talking about people that you're with, that you respect and admire, and what's something you believe that they do not believe. So that's the life hack. It's just that question, which can spark many conversations and often quite memorable conversations, things you might be thinking about years later when you come across that person again.

15:57And I want to flag Kevin's most recent Substack essay. I just read this yesterday because I think it came out on Monday, April 6th, and I thought it's fantastic. So it's entitled Some Contemporary Heresies. And what Kevin does is, well, first of all, he defines a heresy as something that you believe that the people you most admire and respect don't believe and reject out of hand. So you can see how closely this relates to our conversation two months ago. But with that criterion in mind, he basically puts out what he says are a bunch of contemporary heresies that he's collected. He says those aren't necessarily his own.

16:37Sometimes they're other people's, but most of them are plausible and not insane that others around him have said that they believe. So he's just a collector of these things. Some of them are trivial and some are quite dangerous. True heresy, he says at the start of the essay. But what I really love about this essay and completely recommend to you if you find yourself interested in this topic is he's collected 84 contemporary heresies. This is not a list of seven tips, tricks and life hacks. This is not your favorite dirty dozen. This is actually a long, broad list of contemporary heresies. And what I realized is I can gamify that list.

17:17I can start randomizing off that list and scare up a, I don't know, a debate game among my friends. This is probably more a campfire activity. But I love to take things and then gamify them further. And it's just such grist for the mill. It is very rich. So what do you believe that most people don't believe? Gets you thinking. And Kevin takes it a notch higher. And I totally recommend his essay. Again, Some Contemporary Heresies published on April 6th if you want to have more fun with that. Let's move on to number four. Number four is also a life hack. And broadly, I would just describe this as dialing down the size of things or a good book by Peter Sims, Little Bets, making little bets as we go through life.

18:06Now, this is one of those recurring themes that pops up in the wonderful book Building a Second Brain by Tiago Forte, where he reminds us that we can choose the size of our challenge. And I quote, he writes, we forget we have control over the scope of the project. We can dial it down to a more manageable size, and we must if we ever want to see it finished. I think we've all been in situations where we feel overwhelmed. We feel like we may have to drop something altogether or postpone it until we realize maybe we could solve just a part of it and make some progress just off that one thing. Which reminds me of a second book where this concept pops up, which is The Progress Principle by Teresa Amabile and Stephen Kramer.

18:54It's a wonderful book where they explain why small wins beat huge abstract goals. And I quote again from them, large problems, they write, cause paralyzing emotionality and overwhelm cognitive resources, whereas small wins can be gained from breaking down such problems into manageable pieces and approached on a small scale initially for more innovative solutions. So again, Tiago Forte from Building a Second Brain, Amabile and Kramer from The Progress Principle. I mentioned Peter Sims, his wonderful book, Little Bets, which, by the way, starts off with a great story of the comedian Chris Rock at a dive bar.

19:35I think it was in New Jersey. And he doesn't look like the Chris Rock you might be associating with Madison Square Garden because he's got his yellow legal pad out. it. He's standing up at a microphone in New Jersey at a bar that not many people are attending, and he's just haltingly throwing out a joke or two or three, and he's just seeing what people do. And then he sort of notes in his legal pad, people didn't laugh at that one. People did laugh at that one. And what he's making, in the words of the author Peter Sims, is he's making little bets, because every joke you make in life is, in a sense, a little bet, a bet that people might laugh, a bet you might lose, you might be wrong on.

20:17And so what Sims demonstrates is Chris Rock's creative approach, which is just to nudge things out there in a small, well-off Broadway context and see which jokes people respond to. From there, he starts combining the ones that are working together. And all of a sudden, of course, some months later, he is at Madison Square garden entertaining the entire sellout crowd as Chris Rock, the one that we know. But it all starts with the little bets he's making in the dive bar. So again, the key to take a larger project that you might be working on or a goal that you have, breaking it down into smaller problems in order just to solve one of those by constraining the scope of the work to solving just one key problem, let's say.

21:06And then, by the way, after that, another key problem. In fact, Peter Sims uses the phrase rigorously smallifying your problems. And he talks about how liberating it is. And then maybe one fourth example from another book that I love, an author I've had on this podcast, James Clear, and his book Atomic Habits. And I mentioned him last week in context of blasts from the past. But this time, I just want to point out James mentioning that you can decide the type of person you want to be, you prove it to yourself with small wins. So as you develop a new habit, you're deciding the type of person that you want to be, but you now need to actually do this.

21:44You need to do that thing. You need to wake up a little bit earlier that time or have one less drink or whatever it is proving to yourself with a small win one after another as you build a new habit or get rid of an old one. It's all about not being perfect and not doing it all at once. It's about dialing down the scope and creating a momentum with small wins. So in conclusion for this one, when you do that, you're doing three things at once. The first is you're lowering emotional overload and cognitive strain. But the second thing you're doing is you're keeping your projects moving by cutting away the non-essential pieces for the moment.

22:28You'll get to them later, but for now, you don't have to do it all at once. And third, you're also accumulating evidence that's reshaping perhaps your identity, your own confidence, in James Clear's words, while discovering creative solutions that might work for you one little bit at a time, thinking again of Peter Sims. So number four this week, a life hack, dial down the size. You know, it's easy to get overwhelmed in such a busy, noisy world that we all live in. And we're trying to do our best. We're trying to do it all at once sometimes. And I'm just here to remind you this week that you don't have to do it all at once.

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25:21All right, let's move on to number five. I said in my cold open at the top of this week's show that I think I've done this right. I've Googled it. 25 % of Americans can do this, which means three and four of us cannot. And I'm here with number five to suggest that you put in the time. Let's just call it a paperback book one afternoon. And I did this about 40 years ago, and I'm really glad I did. And we all can do this. Juggle. You can juggle. The book is juggling for the complete klutz. I just looked it up you can buy it for$15 on Amazon or wherever fun books are sold $15 book the authors even throw in three bean bags they're attached to the juggling for the complete klutz book that you can start getting your hands dirty with and I will tell you that all of us can juggle it starts not with three in the air but with just one and then you add two and you'll find yourself standing probably up against a wall so that you don't throw your beanbags too far forward.

26:26You start learning to do it on a single plane. And then really, with two beanbags, one in each hand, someone tosses you a third, and you simply toss one of the ones you're holding into the air, catch that one, and keep going. And I realize, for those who can't juggle, you might think, I could never do that. It looks like magic when other people do it. I can only do three myself. Of course, some people can do four or five, or they're juggling flaming bowling pins. But for me, just the delight of being able to juggle with three balls my whole lifelong. I'm so glad I spent time one afternoon teaching myself how to do that.

27:03And when you do connect with that one in four of our fellow Americans, and I realize we have a lot of international listeners, I bet this is a global ratio. I'm going to say one in four of all earthlings can juggle. When you encounter one of those 25 percenters, you can have fun juggling together. And as I mentioned at the top of the show, it at least entertains little kids. There are other benefits and uses to juggling as well. You also look like you're a pretty nimble, spry person. I do have decent hand eye. I don't think I'm amazing at that at all. But you definitely seem to punch above your weight class in other people's eyes when you demonstrate an ability to juggle, especially if they don't.

27:42So my hope is that over the next 10 years, based on the extreme popularity of this one podcast episode, we will bump the global juggling percentage from 25 % to 26 % as a consequence of this week's podcast. Sarcasm is the wit of fools. So number five, I'm going to call it a trick this time. Teach yourself to juggle. All right, on to number six. Number six is a mental tip. This one's maybe easier said than done, but I think you can do it. I try to do it all the time myself. Here it is. Always take the high road. Always take the high road. Charlie Munger, Warren Buffett's longtime protege at Berkshire Hathaway, had a great line here.