A Transformative Guide to Design Your Dream Life — with Sahil Bloom

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1:56Welcome to the 334th episode of the Prop G Pod. What's happening? The dog is back in the incredible city of London. That's right, where the sun has decided to go on vacation. The sun has decided to take fall, winter, and I would imagine spring off. I did have a wonderful weekend. Let's bring this back to me. What are the wonderful things about London? One, it's a great city. Two, Premier League football. Maybe that's number one. Three, probably first and foremost, that's actually probably one, is proximity to the continent. So what did I do with my 14-year-old this weekend? Then we went to Pancras, St.

2:34Pancras train station, which is literally 10 minutes from my house. Got on the Eurostar, which is lovely, which is lovely. And I mean, zoomed at like 330 kilometers per hour. I love public infrastructure. I say raise taxes and just build shit that the public can use. Gare du Nord, two hours and 21 minutes later. And then boom, in our hotel, we went to the Notre Dame. Jesus Christ. I believe that God hangs out there now. Oh, my God. Oh, my God. We're sitting in line for 70 minutes with every tourist from everywhere, including myself. Wow. Wow. No truck to the Dom. Jesus Christ. Seriously. But more importantly, I stayed at a beautiful hotel, went to the pool with my son, because when you have a son, you always got to go to the pool.

3:20You always got to go to the pool. Full stop. Got to check out the pool. That's how we evaluate hotels is by the pool. Then we went upstairs to this fancy Tony restaurant and had light apps, which was delightful. And then the highlight of the trip, we went to the PSG game, 20 minutes to the stadium, boom, parking wasn't that bad into the stadium. Amazing fans. We saw them tie Renz. Great game, fantastic fans. It was raining, but the stadium is designed really well. So we didn't get rained on. And then boom, back to the hotel in just like 22 minutes. What a wonderful, wonderful city. Anyways, that's what I'm doing.

3:57Today, we speak with Sahil Bloom, an investor, entrepreneur, and writer known for his newsletter, The Curiosity Chronicle. That's kind of an interesting name, The Curiosity Chronicle. That sounds like it should be on PBS. We discuss with Sahil his latest book, The Five Types of Wealth, a transformative guide to design your dream life. Okay, moving on to a shakeup in the AI world. Oh my God, what are we gonna talk about? This is kind of the business story of the week. DeepSeek, a Chinese startup that's just over a year old, sent shockwaves through the global tech markets with an AI model that's as powerful as OpenAI's ChatGPT or Google's Gemini, but it was built with just a fraction of the usual resources.

4:38DeepSeek R1 was trained using just 2 ,000 NVIDIA chips and 6 million in computing power. That's about 10 times less than what Meta spent on building its latest AI technology. Why does this matter? This signals a major shift, maybe even a paradigm shift in AI development. Less money and fewer chips equals more players, right? The market essentially has been rewarding investment over innovation. And a small number of players have been running away with it, specifically the ones that have the capital to deploy basically the defense budget of China, which is the capital on their balance sheets and how much they are spending on developing these data centers, buying NVIDIA GPUs.

5:20I mean, just this staggering investment here. And then all of a sudden comes this innovation where the chips are speaking to each other in a more efficient way, as opposed to traditional models that had to be trained in a house where all appliances and all lights were on at the same time. This just said, we figured out a way that you only have to have the lights on in the room you're in and is consuming a fraction of the processing power and the energy, if you will. DeepSeek just proved it's no longer a game dominated by US tech giants. And this is essentially the market has said, again, maybe we overestimated investment versus innovation, but there's more to the story.

5:58DeepSeek didn't just develop this tech, they open-sourced it. That means they shared the underlying code for others to build on. While open-sourced AI accelerates innovation, it does come with serious risk. Many experts argue that U.S. companies shouldn't open source their technologies because they could be exploited to spread disinformation or even create autonomous weapons. This is essentially given the Chinese, you could argue sort of open source, the opportunity to catch up and even blow by this. And this has so many kind of second order effects. First off, not only did chip stocks fall or the AI stocks fall, and we'll more about that.

6:35But the second order of facts was that there had been an equally vicious run-up of energy stocks because the choking point in what we thought was going to be an energy-hungry AI world, you saw Constellation Energy, you saw all these energy stocks skyrocket, they had a significant drawdown because maybe energy isn't going to be as scarce as we had originally thought because of the fact that AI may not be quite as power-hungry as we'd originally anticipated. This is really shaking up global markets. I wouldn't say investors are panicking, but there's definitely been a drawdown. NVIDIA shares plummeted 17 % on Monday after DeepSeek debuted its AI system, wiping out, get this,$600 billion in market value.

7:17This marked NVIDIA's worst trading day since the pandemic crash in 2020. Now, having said that, it requires some context here. That takes them all the way back to where their stock was in October. And when stocks run up like this, it is like a balloon inflating. And if it becomes more and more inflated slash overinflated, the smallest scratch can pop the balloon. And I think that in addition to this news, it's likely that these stocks had had such incredible run-ups that the market was looking for kind of any excuse or any slight brush of the balloon to pop, if you will. But still, this gives you a sense also of how scary to just have markets this concentrated.

7:53Because at$600 billion, you have essentially wiped out the value of a smaller stock market. I mean, that's the value of the entire global auto industry sans Tesla. And this is what happens when markets are allowed to get too concentrated. The other second order effect I find fascinating. So I'm fascinato. Okay. What's fascinating in French? I don't know. But anyways, effectively, you have this argument for global trade. And that is, what would have happened if we had continued to ship NVIDIA chips to China? Would they have been as motivated to figure out a workaround here that would have resulted in what is probably, I mean, this is just, I'm blown away.

8:35I'm blown away. But at the same time, this kind of is following where most markets evolved to. And that is eventually over time, everything goes Android and iOS. What do I mean by that? Scott, what do you mean by that? What's going on? You're on a train. You're in the channel. You're underneath water. You're going 320 kilometers per hour. It's time to put on your thinking cap. You got peace. Do some deep breathing. And then really bring us some blue flame clarity here. Essentially, every market bifurcates into Walmart or Tiffany. And that is, as a species, the easiest way to process information is zeros and ones.

9:09And we've essentially based all innovation or computing on binary code, zero and one. Why? It is easy to understand yes and no. It's easy to understand I'm interested in you, I'm not interested in you, I'm friend, I'm foe, right? So we distill everything down to a basic binary decision framework. That is the fastest way to make decisions. It is the fastest way to process information. So the entire consumer world bifurcates into a binary set of decisions. Do I want the most stuff at the lowest price? Okay, that's Amazon. Okay, that's Walmart. Okay, that's Costco. Do I want something more artisanal that's special, that has self-expressive benefit that makes me feel as if I'm in the company of God?

9:51By the way, the reason why we buy luxury goods is one, it makes us more attractive to potential mates. When I have a Porsche, it says I'm a baller. When I'm a member of Maison Estelle or the new Crane Club or Chez Margot, I just went there last week. Oh my God, talk about a lot of hot people. Jesus Christ. I mean, come on, where do those people come up? They're like those warlocks or whatever they are. Where do they come from? Do they just descend from the ground at like 9 p.m. and go to these members-only clubs in New York? Anyway, zero and one, right? The one, the artisanal stuff, self-expressive benefit, and two, making more attractive to mates, makes you feel closer to God.

10:27The mesh in a Bottega Veneta bag, the slope on the back of a Range Rover makes you feel like it steals you. You're in the presence of something. Why do we do that? Why do we slow down and find inspiration and spirituality as if we're closer to God? It's because the majority of the great artisanal work throughout history has been sequestered to mosques, temples, and churches. When you go into St. Peter's Cathedral, you're like, oh, my God, you see the Pieta? Is that what it's called? You think, Jesus Christ, maybe God does hang out here, or God, maybe Jesus Christ does hang out here. Maybe they're both together.

10:56Maybe it's a father-son basketball tournament. By the way, by far the best moment I've ever had, ever had, or one of the top moments I've ever had, was father-son basketball game, eighth grade, Gulfstream. Daddy had practiced in the backyard with his son. boom, steals the ball, break away, dish off to his son, three, two, one, scores the layup. Eighth grade wins. Hello. My son has never been less embarrassed of me in his life. Anyway, back to me. You have churches and mosques where we got used to seeing these incredible works of artisanship such that when we see these really beautiful things, it does steal us.

11:33It makes us feel more spiritual. It makes us feel maybe this is all worthwhile, or maybe I'm going to go hang out with my parents and my old dog or something like that. But this is the one. That's the one. The zero is the low cost. Everything is bifurcating into zero one. Now, the question is, I would offer, I would posit, I would augur, is the following. Is AI going the same way of all retail and all consumer markets? Are we going to have a zero layer, super inexpensive, open source, built on things? And then are we going to have the Tiffany and the artisanship? And that is, companies will still spend a great deal of money on a massive amount of compute, super sophisticated LLMs that do more sophisticated, artisanal, difficult work, in that we're essentially going where every market is going, and that is we're going Android.

12:17You can get a free phone with a great operating system for free, essentially, if you go Android. Or iOS, where the cost of a phone will command three months average salary of a Hungarian. So I don't know if this is the end of kind of AI as we know it or these companies. There is a risk here, and that is when you have the magnificent 10 representing 27 % of the S &P, and now the S &P or the U.S. market represents 50 % of global value. You have 13 % of the global economy kind of wrapped up or at least led by a small number of companies. And if one sneezes, the entire fucking thing might catch a cold, and that is the world might, or the world economy might get pneumonia if there's a serious drawdown in these stocks.

13:02I also think it reflects some of our arrogance that people like me have been out there saying, we're all AI, who's doing anything important around AI? And China said, I know. China's core competence, they're exercising here. China's core competence, supply chain, and number two, IP theft. They basically steal the plans of the IP and the plans, and architectural plans of a cell tower from Siemens. And instead of building it for$200 ,000, they offer it for$40 ,000. The majority of people think espionage is some good-looking guy killing another agent and then banging the foreign agent or the double agent and then rolling around in an Austin Martin.

13:37No, that's not espionage. Espionage is the following. It's an overweight guy who's the personal assistant to some attache or some senior executive at Google who gets proprietary information on their new LLM or their new search algorithm, puts it on a thumb drive, and then gives it to his handler, and then they ship it to Beijing. The majority of espionage right now isn't about killing spies or state secrets. It's about corporate espionage. This is economic warfare. Think about how few wars are, really, when you think about it, relative to the economic warfare that takes place every day. So number one, confidence of China is, in fact, supply chain.

14:15Number two is IP theft, or specifically espionage. By the way, that's not unusual. If you want to grow your economy faster than 5 % a year, you have to engage in massive theft, which is what we did during the 19th century when we stole European textile and manufacturing technology and littered the eastern seaboard with these factories where we could take advantage of our abundant resources. We even kidnapped artisans and people could operate this machinery. So IP theft is not unique to China. They're just doing it better than us and we're pissed off about it. And this is kind of the ultimate example, right?

14:45They took our open source, they sort of borrowed it, so it's not really theft, call it IP leasing. And they said, I know we can come up with more for less. We did a work around not because you wouldn't ship us those fancy American chips. And we have figured out potentially a way to have the Walmart of AI. This will rock the markets, but I would argue, I would argue this is a natural evolution where we're bifurcating into zeros and ones or Walmart and Tiffany. We'll be right back for our conversation with Sahil Bloom.

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16:57welcome back here's our conversation with sahil bloom an investor entrepreneur and writer known for his newsletter the curiosity chronicle sahil where does this podcast find you i'm in westchester new york just outside new york city nice so in your debut book titled the five types of wealth a transformative guide to design your dream life. You write about five types of wealth, time wealth, social wealth, mental wealth, physical wealth, and financial wealth. Can you break these down for us? Absolutely. Time wealth is all about freedom to choose how you spend your time, who you spend it with, where you spend it, when you trade it for other things.

17:35It's fundamentally about an awareness of the precious nature of time, of time as your most precious asset. Social wealth is all about your relationships, These are the people that you love, the depth of a few close relationships, and then the breath, the connection to something bigger than yourself. Mental wealth is about purpose. It's about growth. It's about creating the space necessary in your life to engage and wrestle with some of those bigger, unanswerable questions in the world, whether through religion, solitude, spirituality, meditation. Physical wealth is about taking the controllable actions on a daily basis to fight the natural decay and atrophy that your body goes through with aging.

18:18It's all about your health and vitality. And then financial wealth, as I talk about it, is what you think of, net worth, money. But with the specific nuance of really focusing in on your definition of enough, what it means to have enough, to wrestle with the idea that your expectations are really your single greatest financial liability. If your expectations rise faster than your assets, you will never feel wealthy. You talk about this term, or you use the term arrival fallacy. Why is it important for everyone to understand and what is it? The arrival fallacy is this common psychological phenomenon that we've all experienced in one form or another in our life.

18:59It is the idea that we prop up these specific achievements, goals, or destinations as the point when we will feel we have arrived. You know, it could be the promotion, it could be the title, it could be the bonus, the pay raise, whatever the thing is, we tell ourselves that once we get to X, we are going to feel that feeling of happiness and contentment that will be durable. And unfortunately, it is a fallacy, meaning you get to it, you feel that sort of momentary dopamine-infused euphoria, and then you immediately reset to some new arrival that you need, some new height, some new summit. You also talk a little bit about this term life razor.

19:38What did you mean by that? The idea of a life razor is to have a single identity defining statement or rule that allows you to literally cut through the noise at different points in your life. So the term razor broadly used is from philosophy, and it's an idea of having a rule of thumb that allows you to simplify decision making. Occam's razor is kind of the most famous one that most people know. it says that the simplest possible explanation is often the best one. The idea of a life raiser is to have a similar simple rule that allows you to navigate whatever chaos or opportunities come. It is a statement, say, a single thing that you could say to help you navigate those situations.

20:20An example would be Mark Randolph, the CEO of Netflix, who often talks about the fact that he had a rule to never skip a Tuesday dinner with his wife. He had a hard rule when he founded Netflix originally. He was the first CEO of the company that at Tuesday at 5 p.m., no matter what was happening at the company, he would leave work and go have dinner with his wife. And that was an identity-defining rule, meaning it had ripple effects into every other area. It meant that he created these boundaries in his life, that while he was pursuing all these professional aspirations, navigating the chaos of founding a technology company, he still put his family and his relationships first.

20:58That empowered other people to do the same. It had all these ripple effects in his life. And it meant something in terms of how his ideal self showed up in the world. So having a similar rule like that, that is your life raiser. It's that single point of focus that helps you navigate through the chaos in life. It strikes me when we go back to the different forms of wealth, time, social, mental, physical, and financial, that you can't have it all. You can have it all just not at once. And that is, I found that my time, social, mental, and physical wealth, took a back seat when I was younger in an attempt to establish financial wealth, or at least establish the trajectory.

21:38And then once I achieved financial wealth, I was able to go back and work on the previous four. So I don't think anyone's going to argue with you around the different types of wealth as you define them. The trick is finding the balance and knowing when to trade off one for the other. Have you given any thought to the fulcrum between the five of these? Absolutely. And exactly what you said relates to something that I talk about and write about often, which is your life has seasons and what you prioritize or focus on during any one season will change. So your 20s and early 30s are an incredible time to focus on building financial wealth because we know compounding, it's going to compound for the rest of our journey.

22:19It's a great time to focus there. That being said, the traditional wisdom around these different types of wealth is that they exist on these on-off switches and that to turn on financial wealth all the way, you have to turn off the others. And the unfortunate thing with that mindset is that a lot of these things will atrophy and die if you don't invest in them at all. You know, it's sort of like thinking about, you know, when you look at a chart of compounding, yes, you know, 1 % per day, everyone likes to show that chart. It gets you to 37X after a year. The unfortunate thing is the negative 1 % per day, which effectively zeros you out after a year.

22:55And that is really the risk that people run by living with that on-off switch mindset. And so what I like to do, the mindset shift that I talk about in the book is these areas all exist on a dimmer switch. And just because you have one turned all the way up, that might be financial wealth in your 20s and 30s, does not mean the other ones should be turned completely off. You can still do the tiny little investment on a daily basis that compounds positively because anything above zero compounds in the direction that you're heading. So if you think about it just tactically for your relationships, as an example, even while you're focusing on your financial wealth and on building your career, sending the one text to your parents to just let them know you were thinking about them, making the phone call, planning that one extra trip, getting together with the old friend for the coffee or gathering the group for the one annual trip.

23:41Those are things that compound positively in that domain that don't take a whole lot of effort. The dimmer switch can be turned down without it zeroing you out. I really like that. I think about you don't need to call your mom every day. I mean, ideally, you can and should, but if you're working exceptionally hard, if you only have time to call her once a week, that one call becomes much more important and has a higher ROI. I say this because in order to achieve financial security, I traded off a lot of those things. And I did try to be home for dinner or at least bath time. I'm self-conscious, which I am.

24:20But I like the notion that even if you take it down to 10 or 20%, that is infinitely better than taking it down to zero. Any specific thoughts about managing the relationship with your partner as you're trying to kind of not go all in, but go mostly in on establishing financial wealth? there are similar principles i would say to you're sort of the analog to texting or calling your mom once a week that you can leverage in your romantic relationship so while you are chasing that purpose of building the big company or going all in on your financial wealth making sure that you create a regular cadence for proper kind of zoom out conversations with your partner uh this entrepreneur named brad feld had this concept called the life dinner which i love it's the idea of doing a once a month, regular cadence date, where you get together to actually talk about some of the bigger picture things in each of your lives and in your relationship.

25:18So talk about some of the challenges, some of the opportunities, the things you're excited about, the things you're stressed about, but create a regular cadence around it. Because what happens in life is when things get stressful, when you have a young child in the house or when you're chasing some financial goal, you forget to do that. And so your ongoing communication just becomes this sort of two ships in the night, you know, little things here and there. And you forget to zoom out and talk about some of those bigger picture questions that actually contribute to true growth in a relationship.

25:47So I've always thought that was a really helpful framing for thinking about that. And you talked about, when you were talking about social wealth, you talked about front row people. What was the Harvard study of adult development and why do you consider it the most impactful study of the last 100 years. The Harvard Study of Adult Development is this incredible longitudinal study that was conducted over the course of 85 plus years. They followed the lives of 1 ,300 original participants, plus another 700 or so direct descendants. And what they found was rather remarkable. They found that the single greatest predictor of physical health at age 80 was relationship satisfaction at age 50.