#701: In Case You Missed It: September 2023 Recap of "The Tim Ferriss Show"

23:36Being envious is not good, you see. But at the same time, if you figure out who you tend to envy, it's not, I don't believe in this, say, oh, people having enough. There's someone here from East Hampton, the fellow who wrote Cash22. A lot of interesting folks out there. Yeah, he met a financier at the time for hedge funds, and the financier said, what is it that, about you, because he was an author, a very successful one, what is it that distinguishes you from me, you know? Look, he told him, I know the meaning of enough. So in other words, you know you're upper bound. And effectively, I don't play that game.

24:16I say, you know, there's a meaning. I am literally, and I say envious of people who are erudites. like if someone knows latin very well i'm envious if someone knows sanskrit i'm envious right so that's and i discovered that early on so i made money on wall street because i wanted to make money on wall street but i didn't think it was worth the effort and luckily it was a combination of universa i had so much leverage you know was marked on all this stuff so the spillover on me was more than satisfactory so i have knock on wood a lot more than than i wished

24:55next up Shane Parrish the entrepreneur behind Farnham Street and author of Clear Thinking turning ordinary moments into extraordinary results

25:11I'd love to get your help defining a phrase just I suppose explaining a phrase and then segueing into a conversation around mental models and cognitive biases and so on. So ordinary moments determine your position and your position determines your results. So what is meant by that line and what is meant by position? So the counterintuitive insight that I had about decision-making from studying sort of Buffett and Munger and Peter Kaufman and a host of other people who've influenced my thinking is that they almost never find themselves out of position. And if you want to think of it as position as your circumstances, they're never forced by circumstances into doing something that they don't want to do.

25:58And often that means they look like an idiot in the short term, but in the long term, they win. And if you consider Buffett, for example, we've talked about, he closes down his partnership during a bull market in the 60s because he doesn't know how to invest anymore. He's lost touch. He can't find what worked for him. He reopens it later in terms of Berkshire Hathaway. Time Magazine, I think it was 1999, he's on the cover as being out of touch. 2001 stock market bursts. Right now, today, I think as of last quarter, he's got$150 billion on the balance sheet. And so what he's always doing is he's, everybody thinks he's out of touch and he looks like an idiot, but he always wins because no matter what the outcome is, he wins.

26:42If the stock market goes up, he wins. If the stock market crashes, he wins because he's put himself in a position where no matter what happens, he can take advantage of circumstances rather than having circumstances take advantage of him. And I think that that's a key element we don't realize. If you put Warren Buffett in a bad position where all of his options are bad, it doesn't matter how smart he is. It doesn't matter how Warren Buffett he is. Everybody looks like an idiot when they're in a bad position, and everybody looks like a genius when they're in a good position. Do you then create that position by having a handful of commandments?

27:17And I'm making these up. I'm not saying this is what Buffett does because I haven't tracked him as closely as you have. But for instance, I know someone who's cut from a similar cloth, and he's like, no short positions, no leverage, and he has four or five rules that he follows, which means he doesn't always beat the S &P 500, let's say, but he's very rarely in a position where he's a distressed seller or is forced into a bad position. So he's able to play a very long game. So I guess I'm wondering how you consistently create that type of position. So let me talk about it in terms of finance and then apply it to something else that's totally you would think it doesn't apply to.

28:02So in finance, you can think of low debt, you can think of saving money, you can think of always having dry powder. It doesn't matter if you have the best idea in the world. If you can't take advantage of that idea, you might as well not have the idea. You have to be in a position to take advantage of the ideas that you have. And you have to be in a position where somebody can't call you in at the exact wrong moment, because that's really expensive, as everybody sort of learned during the great financial crisis and is now forgotten. And we seem to relearn these lessons over and over again. But positioning applies to so many other things that we don't think about.

28:36And you can think about it basically as in your sleep, right? Did you work out? Are you healthy? Are you eating well? Are you investing in your relationship with your partner? What position am I in in the moment that I get into a fight or argument or disagreement with my partner or my spouse? And we don't think about the position we're in at that moment. But if you imagine that there's a patch of grass between you and them, is that grass dry or is it wet? Have I watered that for months, in which case the spark isn't going to light it on fire? Or is this smallest little spark going to start this forest fire?

29:11And the position that we bring into those arguments matters a lot in terms of the quality of the outcomes that we get. But I'll give you another example. We were talking about kids earlier, and I assume a lot of people listening have kids. One of my kids came home with an exam and he got a really terrible mark and he hands it to me. He's like a teenager, so he hands it to me. He's like, I did the best I could, walks away. And normally the conversation ends there. And I was like, okay, well, now is not the moment that we're going to talk about this because I know that this teenage attitude thing going on, but we're going to circle back to this.

29:45And so later that night, I was like, talk to me about what it means to do the best you can. And what he told me about the best he could was like, when he sat down to write that test from 10 to 11, he focused all of his energy and all of his effort on it. He made the best decisions possible from 10 to 11. But what he forgot or didn't really appreciate is what position was he in at 10 a.m. when he sat down to write that test? Did he fight with his brother in the morning? Yep, he did. Did he eat a healthy breakfast? Nope, he didn't. Did he get a good night's sleep? Nope, he was up late. Did he study?

30:21No, he sort of half-assed it. And so what happened was he was in a bad position at the moment he sat down to write that test. He was ill-prepared to write the test, but yes, he did the best he could in that moment. And so often we think about life in terms of how do I do the best I can in this particular moment, rather than how do I put myself in the best position? And part of that is like, we're always predicting, we're predicting creatures. And so we're always trying to gauge what the outcome is and maximize towards that outcome. I want to go all in on Tesla. I want to go all in on whatever, because I want to maximize my return.

30:57And what we don't think about is like, okay, well, what is the cost of doing that? What if I'm wrong? And how do I position myself for multiple possible futures where what if my idea is not correct? Can I still survive and can I thrive on that? And if you look back and you sort of like look back at Carnegie and Rockefeller and all these, you know, historical people who built these great businesses, including Buffett, they always take advantage of a weakness in somebody else's position when their position is strong. So who else would you, and I know you mentioned a few names, but outside of Buffett and Munger, who else would you put on your shortlist?

31:35And not to make you pick favorites, I'm sure that you could give a very long list, but just off the cuff, if you had to pick five to 10 people, let's just say, it could be four, but let's aim for five or slightly more people who you really respect as incisive, deliberate decision makers, who would make that list? So we have a mutual friend, Naval Ravikant. He would be up there. Patrick Collison would sort of be up there. Kat Cole, who works at Athletic Greens, one of my favorite people. She's always one step ahead. She's amazing. I think that there's very few people who are well-positioned in everything.

32:17If you look at somebody who's extremely good at one thing, like Buffett, that comes with extreme weaknesses. you can have a list of exemplars in your head almost of different people who are good at different positions but you have to pick what direction you're going and then what positions do you need to be good at to be good in that direction and so for me like I circle back to sort of like core things which people don't really think about but they're core to everything we do in terms of like health and relationships and friendship and purpose and community am I working on something that I want to be working on?

32:52Am I moving closer to my destination? And is my destination the place I want to go? And I think those questions are stuff that we don't really ask ourselves. We're always so focused on like, how do we accomplish the outcome we want rather than what are the key elements to this process that allow me to play for a long time? Am I going in the right direction? Do I want to get to where I'm going? So I am going to come back to just the broad question of how to incorporate thinking about cognitive biases, if I'm saying that correctly, and or mental models. I guess those are different. I'd love to have you.

33:30Let's begin there. How would you distinguish or define mental models? Then I'm going to go micro, and then we'll zoom out. So a great way to think about mental models is the source of all bad decisions is blind spots. Mental models allow you to see a problem through a different lens. You can adopt a different persona. A great example of a mental model is like, how would Tim Ferriss think about this? And then I adapt what I know about you and I try to see the problem from your perspective. And if I can see the problem from your perspective, now I've done the one thing that actually gets me out of cognitive biases, which is the source of all cognitive biases are basically, we believe that what we see is all there is.

34:11And we learn about this sort of in physics, right? in grade nine, I think, where you're standing on this train and you're carrying this ball and the train is moving at 60 miles an hour. And how fast is the ball moving? Well, relative to you, the ball's not moving. But if you're watching the train go by, the ball's moving at 60 miles an hour. And so the source of all of our problems is that we only see that we're this person on the train holding this ball. And we can't see that there's a person outside who has a completely different view into the exact same situation that we see. So we can mentally use these tools to sort of accommodate how we can look into the world from a different person's eyes or through a different lens, be that biology or through thinking or through, I mean, the most useful ones tend to be like, and then what?

34:59Just asking yourself that simple question, I accomplished this and then what happens? Inversion, how do I avoid all these negative outcomes that I don't want to get. And the Stoics, you've talked about this in the past, the Stoics have been doing this for a long time. They call it a premortem. I think that those are just really helpful ways. And what they're really doing is they're just allowing us to put a different lens onto the problem and see it through a different light. And by seeing it through a different light, we slightly reduce our blind spots into the problem. Yeah, totally. I've found, I haven't read these in decades, so caveat lector for anyone who picks these up.

35:33But Some of Edward de Bono's work, I think he's originally Maltese, but so de Bono's two words, but or actually he may just be a Maltese citizen. I can't peg the nationality. It doesn't really matter. He wrote a book called Lateral Thinking. He has another one. I think it's called The Six Thinking Hats or something along those lines, which similarly very helpful just for forcing yourself as a portion of a practice to look at the same situation with a different lens, It's a different set of questions, a different perspective.

36:06Last but not least, another unpredictable and entertaining edition of The Random Show with technologist and serial entrepreneur, Kevin Rose.

36:20I'll mention something that's sitting outside. I can see it from here that people might be interested in. So I've been, and still am, a fervent believer in cold therapy, using ice baths as a means of controlling inflammation, as a means of mood elevation that lasts on the evening. Oh, mood elevation, big time. Unbelievable. And generally, my approach has been to get a chest freezer of some type and fill it with ice, et cetera. and that works but they get really disgusting really quickly and they all do dude i bought one of the machines a real pro yeah and then you're stuck with this thing that is an eyesore and you don't know what to do with it you can't move it i try to sell it i couldn't yeah yeah so i ended up because i i realized how significant a lever this is for improving my quality of life just on a daily basis like and i'll backstep for a second and just say one thing that i learned from tony robbins to give him credit, and I don't know if he came up with this, but is this sequence of state story strategies.

37:32It's like fix your state first. Only then can you come up with an enabling story and only then can you come up with an effective strategy. If you're like feeling shitty and you're sleep deprived and you're kind of depressed or anxious or whatever, you try to come up with a strategy, meaning how to fix something, you're not going to come up with a good strategy, generally speaking. So it's like fix your physical state first, then you can come up with an enabling story, then come up with an effective strategy. So the state piece is very important. There aren't that many ways I have found to change state.

38:05Exercise is one, but it requires generally a fair amount of time. Heat is also effective, but again, requires, say, it doesn't sound like a much, but it's like 15 to 30 minutes, let's just say, in a sauna. Very effective. Cold is the fastest. It's just the fastest for me. And I've gone without cold therapy because I've not wanted to get some huge chest freezer or a pro model. I am also going to be getting a pro model. But they get all scummy though. And then you got to put chlorine in them. Yeah, there's all that. It's a lot. But I went on Amazon and I found something called the ColdPod, which you set up in like five minutes.

38:44That's you fill it with water from a hose, you put ice in, and it works perfectly well as a cold plunge. And I ended up buying a Yeti cooler to store ice in. So I have a few days of ice. And it's, let's see, what would it be? It would be like if you were standing, maybe it's hip height, and it's probably three feet in diameter. and you get in, you just kind of crouch in there. And it works fucking great. It works really well. And it costs like 150 or 200 bucks, maybe, I don't know, maybe it's 100 bucks. It's not crazy. 169. There you go. And I've been really impressed with this thing. It's very basic.

39:32And even when it's been very hot outside, like you put in two bags of ice and you let it sit for 20 minutes, it's going to get pretty cold. It's not going to be 30 degrees, but it's probably going to be mid-50s, depending on how much water you have in there. Pro tip, the more water you have in there, the more ice you're going to need to cool it. So don't fill it all the way up to the top. Fill it up like halfway and then add the ice. And it's been a game changer for me. It's a plastic trash can, dude. Well, no, it's not a plastic trash can. I mean, props to whoever made this shit because it probably cost like 15 bucks to build one of these things.

40:06Yeah, it's not a trash can. Just to be clear, I mean, look, Look, we're not talking about a fucking Maserati. But here's what's nice about it. It's very easy to set up. It's not a trash can because that makes it sound like it's like mid-chest height and hard. It's easy to pack. You can actually travel with it if you want to travel with it. So I would just say for people who have - How do you travel with it? Oh, it's super easy, man. Oh, it folds up? Yeah, it folds up. You can stick it in a bag. You can take it with you. It's super easy. Put it in your hotel room. Yeah, I hope that loves 50 gallons of water spilling out.

40:44So for those people who have perhaps heard about the benefits of cold therapy, but have avoided it because it's too expensive, it's too time consuming, whatever, this is a way to test it. And I would just say, this is a low hurdle way to test it out. And I used it earlier today. It's fantastic. Changed my day. So that's the cold pot. And there are a bunch of other options that look basically identical. I just went with the one with the best reviews. Nothing fancy.

41:18And now here are the bios for all the guests. Arthur C. Brooks is the Parker Gilbert Montgomery professor of the practice of public and nonprofit leadership at the Harvard Kennedy School and professor of management practice at the Harvard Business School, where he teaches courses on on leadership and happiness. He is also a columnist at The Atlantic, where he writes the popular How to Build a Life column, mega popular. And Brooks is the author of 13 books, including the 2022 number one New York Times bestseller, From Strength to Strength, Finding Success, Happiness, and Deep Purpose in the Second Half of Life, which is a book I've actually recommended in my newsletter, Five Bullet Friday.

41:54His newest book is Build the Life You Want, subtitled The Art and Science of Getting Happier, with co-author Oprah Winfrey. He speaks to audiences all around the world about human happiness and works to raise well-being within private companies, universities, public agencies, and community organizations. We cover a lot of ground. He is a fascinating character with a lot of fascinating frameworks and practices that he implements in his own life, and certainly those that he's studied for his class and for many other projects. You can find him on Instagram at Arthur C. Brooks, on Twitter at Arthur Brooks.

42:32This is an old school Tim Ferriss conversation in the sense that we go all the way back to many of the tools, many of the principles from the four-hour workweek. And that includes virtual assistance, delegation, processes, massive elimination, minimalism for maximum leverage, all sorts of great things. And this time I was in the student seat because my guest today has mastered, I think it is fair to say, so many facets of everything I just mentioned. And it was a pleasure to take so many notes myself to follow up on. His name is Sam Korkos. You can find him on Twitter at Sam Korkos, C-O-R-C-O-S.

43:12Sam is the CEO and co-founder of Levels, an A16Z backed startup that shows you how food affects your health using continuous glucose monitors and other biosensors. Fascinating company, incredibly, incredibly practical technology, easy to use, easy to learn from, changes your behavior, changes your life. Check out Levels at levelshealth.com.

43:36The first guest is Nassim Nicholas Taleb, who spent 21 years as a risk taker, that is, quantitative trader, before becoming a researcher in philosophical, mathematical, and, in his words, mostly practical problems with probability. Taleb is the author of a multi-volume essay, the inserto, and within that you find the black swan, fooled by randomness, anti-fragile, the bed of procrustes, and skin in the game. Thanks to Matt Mullenweg for first introducing me to the black swan. These all cover broad facets of uncertainty. His work has been published into 49 languages. In addition to his trader life, Taleb has also written as a backup of the inserto more than 70 technical and scholarly papers in mathematical statistics, genetics, quantitative of Finance, Statistical Physics, Medicine, Philosophy, Ethics, Economics, and International Affairs around the notion of risk and probability.

44:27These are grouped in the technical inserto. Inserto is spelled I-N-C-E-R-T-O. Taleb is currently Distinguished Professor of Risk Engineering at NYU's Tandon School of Engineering. I believe he's retired. His current focus is on the properties of systems that can handle disorder. In other words, the properties of systems that are, in his phrasing, anti-fragile. You can find him on Twitter at NNTaleb, and that's N-N-T-A-L-E-B, also fooledbyrandomness.com. The second guest is Scott Patterson. Scott Patterson is an investigative reporter for The Wall Street Journal, currently based in Washington, D.C., working on climate and energy policy.

45:03His new book is Chaos Kings, subtitled How Wall Street Traders Make Billions in the New Age of Crisis, a profile of the rise of black swan traders such as Nassim Taleb and Mark Spitznagel, as well as a survey of the many perils the world faces today and how we might fix them. Scott has covered a lot. He's covered everything from Berkshire Hathaway to stock exchanges to high-speed traders to financial regulators. His first book, The Quants, describes the rise of mathematical finance and delves into its role in the 2008 financial blowup. Dark Bulls, his second book, tells how computer traders took control of the U.S.

45:37stock market starting from the birth of computer trading in the 1980s to the explosion of high-frequency trading in the late 2000s. And you can find him on Twitter at Patterson Scott and on his website, scottpattersonbooks.com. And lest you think this conversation is only about finance, I want to emphasize that very refined thinking in the world of markets and investing really reflects clarity of analysis and concepts that then lend themselves to a very clear scoreboard. And for that reason, it is a fascinating arena within which you can refine your thinking toolkit for many, many, many other things.

46:21And we talk about many of these other areas where these things can be cross-applied.

46:29My guest today is Shane Parrish. Shane Parrish is the entrepreneur and wisdom seeker behind Farnham Street and the host of the Knowledge Project podcast, where he focuses on mastering the best of what other people have already figured out. And he has many, many top investors and thinkers on his podcast. His popular online course, Decision by Design, has helped thousands of executives, leaders, and managers around the world learn the repeatable behaviors that improve results. Shane's work has been featured in the New York Times, the Wall Street Journal, and Forbes, among many other outlets. He is the author of the brand new book, Clear Thinking, Turning Ordinary Moments into Extraordinary Results.

47:09You can find him on Instagram at Farnam Street, that's spelled F-A-R-N-A-M Street. On Twitter at Shane A. Parrish, last name P-A-R-R-I-S-H, and all things Farnam Street, including the Knowledge Project you can find at fs.blog. Hey guys, this is Tim again. Just one more thing before you take off, and that is Five Bullet Friday. Would you enjoy getting a short email from me every Friday that provides a little fun before the weekend? Between one and a half and two million people subscribe to my free newsletter, my super short newsletter called Five Bullet Friday. Easy to sign up, easy to cancel. It is basically a half page that I send out every Friday to share the coolest things I've found or discovered or have started exploring over that week.

47:56It's kind of like my diary of cool things. It often includes articles I'm reading, books I'm reading, albums perhaps, gadgets, gizmos, all sorts of tech tricks and so on that get sent to me by my friends, including a lot of podcast guests. And these strange esoteric things end up in my field and then I test them and then I share them with you. So if that sounds fun, again, it's very short, a little tiny bite of goodness before you head off for the weekend, something to think about. If you'd like to try it out, just go to tim.blog slash Friday, Type that into your browser, tim.blog slash Friday.

48:32Drop in your email and you'll get the very next one. Thanks for listening.