9 Timeless Lessons About Human Psychology - Morgan Housel - #707

Morgan Housel is a partner at The Collaborative Fund, an investor and an author. The world continues to change, but the hairless apes that inhabit it stay the same. So there must be some laws of human psychology which remain true, no matter what time and place you're in, and today we get to go through some of the most fascinating ones. Expect to learn the problem with the way most people make predictions, who exactly are the reasonable optimists, whether anyone was able to predict the great depression, just how different median income for families differs from the 1950s to today, why trajectory is much more important than position, why stories are more powerful than statistics and much more... Sponsors: Get 15% discount on the best Colostrum from ARMRA at https://tryarmra.com/modernwisdom (use code: MODERNWISDOM) Get 20% discount on Nomatic’s amazing luggage at https://nomatic.com/modernwisdom (use code MODERNWISDOM) Get $150/£150 discount on the Eight Sleep Pod Cover at https://eightsleep.com/modernwisdom (discount automatically applied) Timestamps: (00:00) What People Get Wrong When Making Predictions (03:50) The Fragility of History (15:35) Having a Positive Relationship with Risk (20:50) The World is Driven By Envy (25:04) Why You Can’t Base Happiness Off Wealth (32:39) The Mental Difficulty of Maintaining Success (41:56) How to Feel More Content With Life (51:58) Why People Desire Certainty (1:00:43) How Successful People Made Huge Decisions (1:07:30) How Morgan Writes His Books (1:18:40) Our Own Logic Can Lead Us Astray (1:26:15) Calmness Precedes Craziness (1:35:09) Are We Competing Against Other Generations? (1:42:10) Life Lessons From the Tallest Man Ever (1:47:07) Where to Find Morgan Extra Stuff: Get my free Reading List of 100 books to read before you die → https://chriswillx.com/books/ Buy my productivity energy drink Neutonic: https://neutonic.com/modernwisdom Episodes You Might Enjoy: This Is How To Master Your Life - David Goggins - #577: ⁠⁠⁠lnkfi.re/SN-Goggins⁠⁠⁠ How To Destroy Your Negative Beliefs - Dr Jordan Peterson - #712: ⁠⁠⁠lnkfi.re/SN-Peterson⁠⁠⁠ The Secret Tools To Hack Your Brain - Dr Andrew Huberman - #700: ⁠⁠⁠lnkfi.re/SN-Huberman⁠⁠ - Get in touch. Instagram: https://www.instagram.com/chriswillx Twitter: https://www.twitter.com/chriswillx YouTube: https://www.youtube.com/modernwisdompodcast Email: https://chriswillx.com/contact/ Learn more about your ad choices. Visit megaphone.fm/adchoices

Speaker names marked ? are inferred from speaking time and the show’s known hosts — they are not voice-verified.

• 0:00Chris Williamson?

  Dude, I got to say, before we get started, your new book is absolutely phenomenal. It feels like it was written purposefully for me. Your ability to weave a story into a lesson is ungodly. And everybody needs to go and buy Same As Ever right now. It's one of the best things that I've read in a very long time.

• 0:18Morgan Housel?

  That makes me so happy to hear. And maybe it was written for the show. Maybe I wrote it just for this episode right now that we're doing.

• 0:22Chris Williamson?

  Yes, yes, I knew it. I knew it. I knew that you dedicated years of your life to just me, my only child. My inner only child is coming out again. Also got to show the Rangers going to the World Series. So I am repping appropriately. The purpose of your book Same As Ever is to kind of, as far as I can see, explain to people the underlying principles and rules, like the thermodynamics of life that doesn't change. But a lot of the time, people focus on things that they think won't change, but will. So what do most people get wrong when they're making predictions?

• 0:58Morgan Housel?

  Well, it's, it's pretty well known that particularly in finance and economics, but also in politics, things like that, we're so bad at predicting, predicting the next recession, predicting when the stock market's going to fall, predicting who's going to win the election. It's not just bad, it's abysmal. It's absolutely disastrous. And so I've been a financial writer for 17 years. And a big part of what I focused on is just trying to answer the question, like, why are we so bad at this? And why does nobody care that we're so bad at this? Despite the track record, people keep doing it over and over again. And one of the, one of the ideas that I, that I stumbled across was just the idea that, and it's, it's, it's kind of ironic and tongue in cheek, but it's not that we're bad at predicting. It's that we're actually very good at predicting, except for the surprises. And the surprises are, tend to be like virtually all that matter over time.

• 1:42Morgan Housel?

  And so part of me was when I just accepted how terrible we are at predicting. There's two, there's two things that you can do after that. You can become a grump about it and just say, just, just become a cynic and say, there's nothing we can do, nobody knows anything, bah humbug. Or you can say, okay, actually, are there things that never change? That we put all of our weight into? And I think if you look over history, across any field in history, business, economics, entertainment, medicine, politics, the themes that repeat themselves over and over again, once you start looking for them, they're everywhere. And it's always like, the characters change, but it's the same movie over and over again. And once you focus on that, and then you marry that with this idea that we can't predict the change, nobody can, nobody's

• 2:26Morgan Housel?

  ever been able to do it, nobody ever will be able to do it, because they're all surprises. And then you marry that with, hey, there's actually all these facets of human behavior that never change. All right, so let's put all of our emphasis and our new view of the future, let's only focus on what we know is never going to change. And there could be literally thousands of those bits of human behavior that never change. For the book, I focused on 23 that I thought were powerful to me, and I thought I had stories to tell about, of these things that like, look, regardless of what happens in the future, we know that these things are going to be part of it, regardless of which direction, which path we go down.

• 3:01Chris Williamson?

  It's so interesting to think about the common thread that ties all of this together, being the idiot shaven apes that kind of inhabit it. The world can be different, there can be a catastrophe or not, it can be peacetime or wartime, there can be a depression, or it can be the greatest wealth creation period in history, but ultimately, humans are always going to respond with the same fear and greed and envy and lack of altruism and focus on their own self first. I had, I know that you quote Neil Ferguson at the start of the book, and I had him on a couple of weeks ago, and I asked him just how accurate is the quote, "History doesn't repeat itself, but it often rhymes," and he called it doubly wrong. He said, "Not only is it not right, it's also not what Mark Twain said." So, just

• 3:45Chris Williamson?

  in case anybody needed a final sort of nail in the coffin of that. Yeah, you've got this great quote as well, where you say, "To know where we're going, you have to know where we've been, but the more realistic is admitting that if you know where we've been, you realize we have no idea where we're going. Events compound in unfathomable ways."

• 4:04Morgan Housel?

  I mean, there's so many, there's so many little stories in history where you realize how fragile history is. And whether it's the start of World War II, or 9/11, or COVID, you realize that there would have been just a little tiny know-nothing change in circumstances that nobody paid any attention to, that would have utterly transformed everything. One of the stories I tell in the book came from David McCullough, who is a historian, died not too long ago, but he was one of the foremost authorities on the Revolutionary War. And I know I'm talking, I'm an American talking to a Brit. This is going to get really awkward here for a second.

• 4:36Chris Williamson?

  I'm, I'm an immigrant to this great nation. I survived two Fourth of Julies without getting into an existential crisis. I'm okay.

• 4:43Morgan Housel?

  Well, let's say bygones be bygones. Let's talk about the Revolutionary War. There's a, there's a scene where David McCullough says, there is a period in the Revolutionary War where the, the British had George Washington cornered, just outside of Long Island. And all they had to do was sail up the East River in New York, and George Washington would have been cornered. It all would have been over. And, but they couldn't do it because the winds were blowing in the wrong direction last night. They could not sail up the East River, which gave George Washington just enough time to get away. And David McCullough was asked, he said, if the winds were blowing in the other direction that night, would there be a United States of America? And he said, no, it never would have happened. Like, the entire existence of this country relied on the winds blowing one direction

• 5:27Morgan Housel?

  this one night in the 1700s. And if you take that out, and you can tell similar stories about the start of World War I, World War II, the Civil War, there's all these, the more you dig into it, you realize how fragile history is. And then you have to accept, if history is that fragile, well, the future is too. There's going to be all these little know-nothing, the equivalent of the wind blowing in the wrong direction that's happening today, that will completely spiral into this god knows unknown story 10 or 20 years into the future. And it's just a plea for humility. Like, when you piece together how fragile the past is, you realize that we have absolutely no clue, some of the finer details of what's going to happen in the future.

• 6:07Chris Williamson?

  Yeah. If you know where we've been, you realize we have no idea where we're going. Each big story could have been turned out differently if it had a few little puffs of nothingness going in the other direction. It's a...

• 6:20Chris Williamson?

  I think people want to have a sense of control and certainty about the future. And it's disquieting to realize just how much random chance gets thrown into this. And that's kind of what a lot of people didn't like. The fact that Neil said the cycles of history aren't really cycles, the only things that are the same are the humans, because it makes us feel uncertain. And we go, oh, my God, like, maybe, maybe I'm not going to be able to predict what happens next. And he goes, well, yeah, previously, could you have predicted what happened then? What was that thing about, about the depression? Like, how many people were able to predict the depression?

• 6:59Morgan Housel?

  Zero, exactly zero people. Robert Schiller from Yale University won the Nobel Prize in Economics. He devoted a big chunk of his career to working with economic historians to find one person who predicted the Great Depression. And they could find a couple of people who would say, we're look, you know, the economy is due to decline or due for a recession. But who predicted the Great Depression? 0.0 people. And of course, that was, that was the biggest economic event of the century. And so, and look, people were pretty well informed back then. It's not that people were running around oblivious to what was happening. Everyone knew the stock market was crazy. Everyone knew things were stretched here. But the chain of events that actually turned the decline into the Great Depression could not have been foreseen. I mean, the, the, not to go, not to go down too much of

• 7:43Morgan Housel?

  a rabbit hole here, but what really made the Great Depression awful was the banking crisis. It wasn't the stock market crash. It wasn't necessarily the Dust Bowl. It was, once the banks started failing, all hell broke loose. And the banking crisis really began in Austria, when there was a big bank called Credit Ansal that went out of business. And you can literally track it on a map that the banking wave spread across the world. It went from Austria to Paris to London and eventually made its way to New York and then spread throughout the rest of the United States. And it's literally like, you can, you can draw a straight line from this Austrian bank in 1931, going out of business to a guy in the middle of Ohio, losing his job. It's not the kind of thing that somebody in 1925 could have predicted.

• 8:26Morgan Housel?

  It was such a crazy chain of events that made it all happen.

• 8:29Chris Williamson?

  Yeah, you've got this nice summation. We are very good at predicting the future, except for the surprises.

• 8:37Morgan Housel?

  And the next line of that was, and the surprises tend to be all that matter over time. It tends to be like, if you look at the big events that have really moved the needle in history for the last 80 years, in the United States at least, it's Pearl Harbor, September 11th, COVID. Those are the things that like, we woke up one morning and we said, oh shit, the world is not the same. The world is not the same place it was yesterday. And the common denominator of those three events, and you could add some more to it, are that nobody saw them coming. There were not, there was no economic outlook a year before that said, get ready for nine 11. Nobody wrote that in the year 2000. I write in the book, this crazy newscast that I came across, and it's from the morning of September 11th,

• 9:19Morgan Housel?

  and it's like haunting to listen to. It, it, it, it takes place about 20 minutes before the attack takes place. And it's this newscaster, I'm going to paraphrase, but she says, good morning, it's Tuesday, September, September 11th, beautiful day here in New York City. The, the side, like, she's completely oblivious to what's about to happen 20 minutes later, which of course, nobody could have seen it coming. And you can say with so much certainty that the biggest news story of the next year, and the next five years, the next 10 years, is something that nobody is talking about today, that everyone's completely oblivious to. Because it's always been like that. It's always been like that. I mean, just in recent times, how many people, a month ago, were talking about Hamas and Israel? Outside of

• 10:04Morgan Housel?

  that region, zero. Nobody. But now it's the biggest news story in the world. Same with two years ago with Russia and Ukraine, COVID, of course. Like, there's a great quote from Carl Richards, financial advisor. He says, "Risk is what is left over when you think you've thought of everything." So you go out of your way to try to view the future in your own life and in the economy. And it's like, great, that's a good thing to do. And then after you have thought about all the risks in your life, the thing that you're not thinking about, the thing that's not on that list, is the one that's actually going to do the most damage.

• 10:34Chris Williamson?

  Because if it was on the list, you would have mitigated it in some way or another.

• 10:38Morgan Housel?

  You would prepare for it. I mean, the perfect example of that is Y2K. It's not that it wasn't a risk, but everyone had been freaking out about it for five years. So when it happened, everyone had prepared for it. The computers had been changed, whatever it was. So compare Y2K to nine 11, that nobody saw coming. It's like, it's night and day.

• 10:54Chris Williamson?

  Who was that NASA guy?

• 10:58Morgan Housel?

  Who's that?

• 10:58Chris Williamson?

  The dude with the helmet.

• 11:00Morgan Housel?

  Yes, yes. Should I rehash that?

• 11:03Chris Williamson?

  I want to hear. I love that story, dude. It was one of the best ones in the book.

• 11:07Morgan Housel?

  So it's a crazy story that I came across. I was reading, I had this kick a couple of years ago where I was really into studying the Apollo missions because I think going to the moon is the coolest thing humans have ever done. It's like the craziest, the riskiest, the most ballsy. And I came across this little story and it was almost a footnote, but it was one of those things where you read it and you're like, wait, tell me more about that. That sounds fascinating. And what it was is before NASA went into space on rockets, which were expensive and dangerous, they used to test a lot of their equipment on these ultra-high-altitude hot air balloons. They had these hot air balloons that could go up to like 150,000 feet, like basically the edge of space, and they would do it to test a lot of their equipment. So in July of 1960, there was a US Air Force test pilot, his name was Victor Prather,

• 11:50Morgan Housel?

  who took the hot air balloon up to about 112,000 feet to test NASA's new suit. It was a suit that they eventually used in the Gemini missions. And he goes up, suit works great, everything's perfect. He's heading back down to earth. He starts descending back down to earth. And one of the quirks of the suit that he was wearing, the space suit, was that it was very hot and stuffy to breathe in, particularly in the Florida summer heat as he's descending back down to earth. So when he was low enough to breathe on his own, which is like 5,000 feet, he opened up the faceplate on his helmet just to catch some fresh air, like not that big a deal. He knows he's low enough to breathe on his own, like who cares? The Plan A in that situation is that the hot air balloon would land on the back of an aircraft carrier. That was what they intended. But a very well-known and well-rehearsed Plan B is that he would land in the ocean

• 12:36Morgan Housel?

  because it was just hard to stick the landing on this hot air balloon. And so that's what happens. He lands in the ocean, nobody's panicking. In that situation, an Air Force helicopter is going to hover over him, drop a rescue line that he attaches to himself and gets pulled to safety. As he's doing that, he slips and he falls into the ocean. And that too, like was not supposed to be that big a deal. They had rehearsed this and whatnot. But because the suit that he was wearing was supposed to be watertight and buoyant, he's supposed to bob in the water. But since he had opened up the faceplate to his helmet, all of a sudden, he was not watertight. And as soon as he hits the water, his suit fills up with water and he sinks to the bottom of the ocean and drowns. And there could be so many takeaways from this story.

• 13:20Morgan Housel?

  One of them that I think is just bonkers is that there are four NASA astronauts who die in the mission getting to the moon. All of them died on earth, which is just like crazy in itself. But the other that I think about a lot is that NASA is the most planning centric organization that's ever existed. Like you don't go to the moon by crossing your fingers and hoping for the best. Every imaginable risk that they could think of was planned out and they had plan A, B, and C contingencies for how to mitigate that risk. And in their postmortem of what happened to Victor Prather when he drowned, they said something to the effect of, we had thought of every single risk imaginable in this mission, except for the one thing that mattered most, which is that this poor guy just wanted to get some fresh air.

• 14:05Morgan Housel?

  And that, I think that's the definition of risk. It's what's left over when you think you've thought of everything. The other thing is like, you can imagine the planners for this mission, planning about what hap- I'm making this up because I don't, I'm not an engineer. What happens if the balloon pops? What happens if we run out of fuel? Whatever it might be. You're not going to plan what happens if this poor guy wants to catch some fresh air. Right? There was another story that I wrote about in the psychology of money that I thought was just so ridiculous when I read it. It was during the Battle of Stalingrad in World War II. And there was a division of German tanks out on the rear lines and they got called up to the front. And it's like 20 or 30 tanks that could get called up to the front battle lines. All the tank commanders turn their tank on, I don't know if it's a key or a button or whatever, and none of them start.

• 14:50Morgan Housel?

  The entire division of tanks, the tanks don't start. And they start to research what the hell's going on here. And they realize that when the tanks were sitting in reserve, the field mice outside of Stalingrad chewed through the wires. And then so they can't, so I use this an example too of like, imagine you're like an army general and you're planning for what can go wrong. And what can go wrong is you get shot at, you get bombed, you run out of food. Nobody is like, hey, make sure that we protect ourselves from the mice in the fields. Right? It's always a thing that you never see coming that's actually going to pose the biggest risk.

• 15:25Chris Williamson?

  I wonder if those were specially trained saboteur mice, perhaps?

• 15:28Morgan Housel?

  They were, they were Soviet trained mice during that period.

• 15:32Chris Williamson?

  That would be correct. So given the fact that risk is what is left over after we think that we've thought of everything.

• 15:40Chris Williamson?

  But what can we do about risk? What should our relationship with risk be like? Given that, as you say, I mean, do people become nihilistic and just stop caring about risk at all? Do people become overly risk averse and try to steer clear of stuff? What's your relationship to risk like?

• 15:57Morgan Housel?

  I do think there's some balance between those two. I think the honest answer to your question is this is why the world is risky and it's always going to be risky and there is not much we can do about it. I think that's that's the honest answer. If there is a more technical answer that I think particularly as it pertains to finance, it's that if you are only planning for and saving for the risks that you can envision, by definition, you're going to miss the surprise every single time. And so I tend to have quite a bit of cash as a percentage of my net worth. And there have been a lot of people who would ask like, why? Like, what are you saving for? And my answer is always, I don't know. Because of course, if I was only planning for things that I could envision, oh, I'm going to need a new car here and my kids are going to go to college then, you're always

• 16:39Morgan Housel?

  going to miss the equivalent of Pearl Harbor nine 11 COVID every single time. So the amount of safety that you have, it's not to say can be completely risk averse. That's not the point at all. But the amount of cushion that you have should feel like it's too much. Because when it feels like it's too much.

• 16:55Chris Williamson?

  You say it should make you wince.

• 16:57Morgan Housel?

  It should make you wince a little bit. Yeah. Because it like, like, like if it feels like the right amount, then you know you're unprepared by definition.

• 17:05Chris Williamson?

  Right. So I guess the meta lesson here, or it sounds like is bake in more contingency, a greater buffer around your current risk profile to attempt as best you can to account for that which has been left over that you haven't been able to think of.

• 17:24Morgan Housel?

  That's the only way to do it. And the other thing to just to recognize is that the world usually breaks about once per decade. Not, not, not exactly on that timeline, but pretty much once per decade, there's a big event where, like I said, people wake up and they say the world's not the same as it used to be. So during that time, when your savings makes you wince, you might have to sit on a wincing amount of savings for a decade. But once a decade, you're going to realize it's the most valuable asset you've ever had in your life.

• 17:50Chris Williamson?

  The first rule of happiness is low expectations. Why?

• 17:56Morgan Housel?

  Because every, every bit of happiness, every bit of joy that you're going to get out of life is simply the gap between your expectations and your circumstances. And you could show this very cleanly by just pointing out things like John D Rockefeller, he was, he was the richest man who ever lived. His adjusted for inflation, he was worth nearly half a trillion dollars in his time. But during his entire life, I think he died in 1933 or thereabouts, he never had penicillin, sunscreen, Advil, to say nothing of the internet or communications of any, of any kind. Like, he lived a life that the average, ordinary American would look at today and view as positively primitive. Of course, he had mansions and servants in one that, but in terms of the technology he, he took advantage of, it was a joke. But

• 18:41Morgan Housel?

  no average American should look at him today and say, I live better than Rockefeller, because they have penicillin and sunscreen and Advil. Because everything, all those new technologies just become the baseline that we accept. And therefore, that, that's just to say, like, you can go through a period of life, or the economy in general, where everything gets better. Technology gets better, medicine gets better, everyone becomes richer, and nobody feels any better off for it. Because you just reset your expectations all along the way. And you could so imagine a world in which my grandkids are earning three times as much as me, adjusted for inflation, and they're not any happier whatsoever. And the medical, the technology that they have, let's just assume they've cured cancer, they've cured, they've cured every, they've cured every disease, and they're not any happier for

• 19:26Morgan Housel?

  it. Because that just becomes the norm. Just like when I today, by and large, don't think about malaria. If, if, if you told somebody three years ago, that we in the developed world had more or less eradicated malaria, they would have, they would, they could not fathom a world being that glorious.

• 19:42Chris Williamson?

  Are you familiar with, are you familiar with the Tocqueville paradox?

• 19:46Morgan Housel?

  Of course, yeah.

• 19:47Chris Williamson?

  Yeah, that's exactly what we're describing here. Yeah, as living standards rise, people's expectations rise, and then overtake the actual living standards.

• 19:54Morgan Housel?

  That's it. And at the micro level, it happens too. Where, you know, if, if you get, if you get a raise at work, But then with that raise, you automatically adjust your expectations to the kind of house you need to live in, to the kind of car that you drive, to the kind of vacations that you take, you instantly, that's why you get used to these things so quickly. It's not necessarily that you become accustomed to them. It's that you raise your baseline of what you expect in them. And so, look, is it important to try to increase your circumstances, become wealthier, increase your net worth? Of course, duh. But with just as much emphasis, you need to go out of your way to manage your expectations, to keep them low, and recognize that it's the gap between those two that's actually going to bring you all the joy and happiness in life. So as a society, there's, there's no way to do it.

• 20:37Morgan Housel?

  It's always going to be the case that society's expectations increases. That's the Tocqueville paradox. At the individual level, I think you can at least recognize the game that's being played, though, and how ridiculous the game is.

• 20:47Chris Williamson?

  What's that? Is it a Mungo quote where he says the world is actually driven by, it's not driven by greed, it's driven by envy?

• 20:55Morgan Housel?

  That's it. And, and really what envy is, is you're looking at your neighbor who has a bigger house and saying, I want that. That's all it is, which is just, it's just an adjustment of expectations. In the 1950s, which people tend to remember as this glorious period of prosperity, the average new house built was 920 square feet. And today, in the United States, it's like 2,700 square feet. But people don't feel better off. And I, and not only do they not feel better off, the people who are moving into a house that is two and a half times the size of what we, of what my grandparents would have moved into, probably feel like they're falling behind. Oh, my house is 2,700 square feet, but on Instagram, that guy's house is 10,000 square feet, kind of thing. It's just a constant readjustment of expectations.

• 21:37Morgan Housel?

  Part of that, by the way, this is an important thing here, is great. The fact that people are generally unsatisfied is where innovation comes from. The fact that people wake up in the morning and say, I'm unsatisfied with my lot in life, I need to do better and figure out a better way, is why the world improves. So it's not to say that this is bad, but it's an explanation for why there can be so much progress in your individual life or throughout all society, and nobody feels any better for it.

• 22:02Chris Williamson?

  Have I given you my bit on the mistranslation of the Buddha? Have I given you this one yet?

• 22:08Morgan Housel?

  No, no.

• 22:09Chris Williamson?

  So this is from Robert Wright's Why Buddhism is True. And in it, life is suffering is commonly quoted as coming from the Buddha, but scholars contest that the translation is actually wrong. And the final word, which is dukkha, D U K K H A, isn't translated as suffering, but unsatisfactoriness. Life is unsatisfactoriness. And I often think about this imaginary couple that I have a voyeurist relationship with every time I think of this thing. So they plan a holiday. They know that they're going to go away and both of them are big into putting their itinerary together and they know exactly the hotel that they're going to go to. And they look at the menu of the hotel, of the hotel bar and of the restaurant that

• 22:53Chris Williamson?

  they're going to go to, and they know the exact table that they're going to sit at. And they know that the sun sets and they've imagined it and they've thought about it and they've organised the kennel to look after the dog. And then they fly out and they get there and they sit down. And then the wife sits down and she's facing the sun, but the sun's actually a little bit low and it's sort of glancing off the water and it's a little bit bright for her eyes. And they got this cocktail, but they wish that they'd got it on the rocks instead of blended. And there was some sand between her toes from walking on the beach a little bit earlier on. Life is unsatisfactoriness. It is baked into your existence that things are just going to be, on average, a bit shitter than you hope they would. And even if they outdid your expectation, very quickly, you're going to be looking over the current moment's shoulder, just trying to see what's coming next.

• 23:39Morgan Housel?

  A hundred percent. I mean, and by the way, I love the phrase, just a bit shitter than you expected. That's a wonderful phrase. I think a lot of this too, is that you get the most dopamine from anticipation. It's not by actually achieving it. You get the dopamine by dreaming about it. So of course, it's well known that the best part of a summer vacation is the anticipation of it, but actually going on it is not.

• 24:00Chris Williamson?

  Didn't Ferris have a hack where he would, him and his family would book like the next half decade of holidays? I'm pretty sure that he did, that he would just be like, well, okay, if enjoyment is in the anticipation, if I get more anticipation, that means more enjoyment from the same experience. And I'm pretty sure that there was a period where he had like five years of holidays and resorts and trips and flights and everything else booked, booked, booked out for precisely that reason.

• 24:27Morgan Housel?

  That's so smart. I I've had these ridiculous moments in the past. I'm sure others have something similar of, I'll be on vacation, I'll be in Maui with my family and it's day one, we just get there. And I'm standing on the balcony, watching the sunset and thinking to myself, wouldn't it be so great if we could come back here next year? Like, like, even though I'm I'm literally right there, what gives me the most pleasure is thinking about coming back. And then I instantly have this recognition of just like, this is so absurd. But that's how your brain works, because thinking about coming back is going to give you more dopamine than actually the fact that you're there in the moment.

• 25:01Chris Williamson?

  There's an interesting insight from Gad Saad's new book on happiness, that the amount of sex that makes somebody happiest is an adequate amount based on kind of an overall baseline. But what's most important is that you're having a little bit more sex than most of your friends are, based on their self-reporting. And you've got this phenomenal quote, which I think kind of summarizes where we're at. There is no such thing as objective wealth. Everything is relative and most relative to those around you. There is no such thing as objective wealth. Is phenomenal and it's so true, given the fact that, okay, are people today with all of the advantages that we have a hundred years hence, better off than John D Rockefeller? Well, no one's going to say that. No working class American

• 25:47Chris Williamson?

  that's living paycheck to paycheck is going to feel like they're more blessed than what was once the richest man potentially who ever lived, apart from Massa Moussa or whatever that dude was. It's, no one's going to feel like that. And yet objectively, there are arguments that you can have on both sides.

• 26:04Morgan Housel?

  Right. You know, there's, as, as most comedians do, they really get to the point. There's this great Chris Rock skit where he says, if Bill Gates woke up with Oprah's money, he'd jump out the window and slit his wrists on the way down. And it's just to show that all wealth is so relative. And so I, yeah, and then once, once it's framed like that, there's this other quote from Montesquieu, who said this 300 years ago, back to things that never change. He said, if you wish to be happy, that could very easily be achieved. But most people want to be happier than other people. And that is difficult because we overestimate how happy other people are. So that's the thing too. It's not about how much you have, it's just where do you sit on the relative lot? And from an evolutionary standpoint, of course, that's the case because we're competing against each other for resources

• 26:48Morgan Housel?

  and for mates. So of course, it doesn't matter how much I have, it just matters that I have more than you. Not you in particular, but you know.

• 26:54Chris Williamson?

  So this must relate to fame and status as well, beyond just finances.

• 27:00Morgan Housel?

  Yeah, I forget who said this quote, but there's, I read something recently that said, "It's so tragic that humans are not wired for happiness, they're wired for status." That's what we're going after. It's not, "What can I do to make me happier?" It's, "What can I do that puts me ahead of the other people?" And I think there's actually a lot of people early on in their career that really get this wrong, in the sense of they might have a skill. "I'm really good at Microsoft Office." Yes, but so is everybody else. Like, on relative terms, that means absolutely nothing. And people over, they overestimate that, how rare their skills are. And then they get to the job market, and they, their first salary sucks, and they're not, they're not that useful, and they can't figure it out. It's because the skills that they have, everybody else has them too. In

• 27:43Morgan Housel?

  relative terms, they're zero. And so that's, that's, that's really true. It's true in investing too, where it's like, it doesn't matter if you have a lot of information. All that matters is the information that you have that others don't. And, and that number for most investors is zero. The information that you have that others don't, doesn't exist. There's no information that you have about the stock that others don't. And that's why it's so hard to beat the market over time. Everything is just relative to what other people have and what other people are doing.

• 28:12Chris Williamson?

  I've got this idea at the moment about trajectory being more important than position, and it's literally the same lesson, but from a status, fame perspective. So if you are the number two in the world, but last year were number one, there is way less sexiness and clamor around you than if you're number 150, but last year you were 300. And there's something about our prediction engine, being able to kind of move out, let's extrapolate into the future, exactly where this person's going to end up, and what they're going to do. And there's this sort of allure of what's trendy. Something else that's going on specifically

• 28:52Chris Williamson?

  with that, which is, someone who is a, an appreciating stock as opposed to a declining stock, even if their absolute position is lower, it tells you more about the current sentiment right now. And because our availability bias and our window of what we're seeing is so dependent on the moment. We overindex for the person who is on the climb but lower as opposed to the person who's maybe at the top, but not staying there.

• 29:22Morgan Housel?

  There's this great quote from Will Smith in his biography where he says, becoming famous is the most amazing feeling in the world. Being famous is a mixed bag and losing fame is a pain like you've never felt before. And like, I think it's true for wealth too, that becoming wealthier, like your net worth rising is amazing. Being wealthy, just having a high net worth is like, is okay. And losing wealth is terrible. It's always just the change in circumstances that you're after. Like you, like, most people get more joy and pleasure out of gaining wealth than they do having wealth.

• 29:57Chris Williamson?

  Dude.

• 29:57Morgan Housel?

  And they're going to be happier when it's going up than when they actually have it.

• 30:00Chris Williamson?

  You weren't going to guess this, but Andrew Tate said it best. Not one for quoting Andrew Tate, but I do love this quote from him. And he says, having things isn't fun. Getting things is fun.

• 30:13Morgan Housel?

  There's a great quote from Drake too, where he says, people respect you more when you are chasing something, not when you have it.

• 30:20Chris Williamson?

  So good.

• 30:21Morgan Housel?

  Yeah. And I think that it applies to virtually everything. And it just, it, it, it kind of boils down to, isn't life just one big competition? We're just trying to get ahead. And it's kind of a sad thing to come to terms with. And I think there are ways to combat that at the individual level and not always be on the rat race, but just enjoy what you have inside of your own head. But at the, at the, at the society level, it has always been like that and always will be.

• 30:45Chris Williamson?

  I'd mentioned before we started, I was with Dan Bilzerian this weekend and I rolled this trajectory is more important than position thing to him. And he seemed to agree too. And I said, I wonder if there's an argument to be made that rapid changes in status and wealth and accolade and prestige are actually to be avoided almost at all costs. Because what you're doing is you're now resetting that baseline, as you mentioned.

• 31:11Morgan Housel?

  That's so good.

• 31:12Chris Williamson?

  Yeah. So I'm.

• 31:15Chris Williamson?

  Not like slow life strategy, but slow success strategy. Trying as best you can to just pulled pork this thing out a little bit. Let's just spread out. You know, I'm not going to, I'm not going to go and get the car that I've always wanted immediately. Why don't I get a car that's halfway between it? You know, let's, it's strange because we want success. We don't want to leave anything on the table. We want to feel like we're actualizing. We want to maximize whatever we can bring to the world. And yet, the quicker that we do that, all that we're really doing is condemning a future version of ourselves to have a higher bar to jump over.

• 31:49Morgan Housel?

  Right. I mean, the, the perfect example of that, everyone knows the long history of lottery winners, either going bankrupt or being miserable afterwards. Like, I, I know recently, because the lotteries now get ridiculous. There was someone who was like a very modest, blue collar working worker. Imagine this person was making forty, fifty thousand dollars a year and they won a billion dollars in the lottery. And that honestly, to go from making forty grand to getting a check for a billion dollars has got to be the, the biggest mindfuck that you can imagine. And I don't mean that in a good way. I think, I think, I think that is, that is, is something that on net, it's, it's ridiculous to say, I know it sounds crazy, but on net, that's going to be, that's, that's a psychological burden.

• 32:30Chris Williamson?

  Could be, it could be, it could be one of the most difficult things that you've ever had to deal with in your life. You know, Rips, I, I had this idea as well about, um, guys like Jordan Peterson and Brett Weinstein and Eric Weinstein, you know, people who, for a long time were academics, working in the dusty annals of some place. And then they get ripped out of obscurity by some bald MMA commentator. And before they know it, that, you know, heavily scrutinized and people care about what they think and, oh my God, I need to comment on the Ukraine and, oh, yeah, let's get involved in the trans issue. Like, they had, we, we often talk about the perils of fame too young, but we never talk about the perils of fame too old, right? Like, young fame is you never got the chance to work out what it's like to be a normal person.

• 33:15Chris Williamson?

  You turned into Macaulay Culkin or whatever. But like, more old fame is you thought you knew who you were and your sense of self has been completely ripped away from what you actually, your, your entire conception. The way that people see you, how much they care about what you've got to say, you, decades and decades and decades of time accumulated, ossifying this version of you you thought you were. For something to come in and just smash it to pieces in the space of no time at all.

• 33:42Morgan Housel?

  Just totally, ah, that's great. I, I, I spoke with this author recently, whose first book was a mega blockbuster success. And his second book was by any objective standards, a huge success, but in order of magnitude or two, less lower than his first book.

• 33:58Chris Williamson?

  Shit, totally shit.

• 34:00Morgan Housel?

  And I asked him how that felt. And he said, even though he knew that was going to be the case, going into his second book, he knew that would be the case. And he was prepared for this. It hurt. It hurt. Cause his first book set the bar so ridiculously high.

• 34:14Chris Williamson?

  Have you got this in your mind, given that the psychology of money, your first book was, I mean, you would, you're telling me that it's, it's growing. It's like the R naught number of your book is like COVID at a bad day. Uh, yeah. Have, have you got it that same as ever, despite the fact that everyone needs to go and buy it right now? And the link is in the description below, is almost certainly going to be a disappointment to you?

• 34:36Morgan Housel?

  Yeah, I, I think about it a lot. And that was the, one of the points of talking to that author who I was speaking with. Cause I, I know this is going to be my situation of, yeah, how do you prepare mentally? When I, I hope to write many books in my career and I would bet very good money that the first book I wrote will by an order of magnitude be the biggest seller. It's kind of, it's kind of a hard thing to, to wrap your head around. Of course it's a good problem to have. Nobody feels bad for you. But yeah, it is kind of a hard thing. Like when I'm 66, how am I going to feel knowing that I peaked at age 36 when Psychology of Money came out? It's probably not going to feel that great, to be honest. But it's, of all the problems to have, it's, it's not a bad one.

• 35:15Chris Williamson?

  Yeah. Uh, have you seen the Lewis Capaldi documentary?

• 35:19Morgan Housel?

  No.

• 35:19Chris Williamson?

  Do you know who Lewis Capaldi is? Scottish singer guy. You would have heard his song 100%. One of your kids will have had his song on at some point, or you'll have heard it on the radio, billions and billions and billions of streams and albums and all this stuff. Documentary about him and he has to write a second album. First album's just ridiculous success, right? Globe trotting insanity. And it's songs that he wrote when he was 17, still playing them in working men's pubs around Scotland, right? And it's better mastering and studios and all the rest of it, but it's the same songs. And then. He gets this catapulted to the top of the tree and then is told, right, do it again. And COVID happens. So he's back in his parents' house in Scotland,

• 36:01Chris Williamson?

  in this shed type thing that's got his recording equipment in there, trying to write songs for his second album. And he develops a twitch, like a Tourette's twitch. And it's, there's videos, you can look at the videos, it's pretty uncomfortable to watch of him at Glastonbury, big festivals, and he can't sing. Like, he literally can't get the words out because of how nervous he is. So he's very much feeling the pressure. A man who has the talent, but not the constitution to be famous, which I think is a beautiful, very interesting dichotomy. And he's got this one line in it that I paused the documentary and just turned it off after that and went into like a fever dream for about an hour thinking about it. And he's there and he's talking about all of this change and there's been all of this chaos around him and he's trying

• 36:46Chris Williamson?

  to write the second album and the pressure from the label and all of this sort of stuff. And he turns to the camera and he goes, fame doesn't change you. It just changes everybody around you.

• 36:55Morgan Housel?

  Yeah, yeah.

• 36:57Chris Williamson?

  Oh my God. Every time I say it, dude, I get my, the hairs on my arms stand up because I just thought it was so profound and so beautiful. And, uh, yeah, yeah, you should watch it. It's on Netflix.

• 37:09Morgan Housel?

  It's kind of scary because what do so many people, even if not explicitly, but they implicitly hope for and want in life, it rounds to fame at least, if not explicitly fame is what they want. And then you watch these people who've actually had it. And there's a lot of baggage attached to it. And I really admire the people who went out of their way to push back or to quit the system. One is the actress Cameron Diaz, mega A-list actress. And then she said, she's done. She's, she's done acting. Now, she's still famous. I'm sure the paparazzi still hound her and whatnot. She, she can't get rid of that. But for people who say, I've had enough. I achieved what I wanted to in this industry and I'm, and I'm out of here. The other example, I don't know how to pronounce

• 37:50Morgan Housel?

  this band's name. It was spelled G O I T E. And they had one mega hit in 2012. I, I don't know how to pronounce it. Goy, goydy, whatever it is.

• 38:00Chris Williamson?

  Sounds like goy, yeah.

• 38:01Morgan Housel?

  I think that's what it is. And they had this mega, mega blockbuster hit in 2012. It's all over the world. It's like the top song. And then they just quit. They said, we're done. Like, we're never going to top that. We're out of here. And I have so much respect for that, if you can actually pull it off. It's the people who feel like they start with a mega blockbuster and then they have to top it the next time. That you are, you're guaranteeing yourself depression and misery if, if that's your goal.

• 38:24Chris Williamson?

  You had this other bit saying, expectations are easy to ignore because their value isn't on a price tag. What's that?

• 38:33Morgan Housel?

  No, we, well, we know. What is the cost of a Ferrari? You can look at the price tag. You know what the cost is. It's very easy to measure and put on a spreadsheet and get with precision. This is the cost of a Ferrari. Not only is this a cost, but here's how much work you have to do to earn that much money. So it's very, it's very quantifiable. But what is the cost of high expectations? Most people are completely oblivious to them and you can't really measure them with a lot of precision. But they are an enormous cost because they're weighing on your happiness. And so that's, that's really what it is. And that's why they're so easy to ignore is because they're not on a price tag. It's not quantifiable. How do I say, like, how do I quantify the fact that I have higher expectations for medical care than John D Rockefeller did? How do you quantify that? You can't, but it's very real. It's extremely real.

• 39:18Chris Williamson?

  Yeah, I, I've got another one for you, dude. So me and George Mack have been working on this for a while. Hidden and observable metrics. And it's our contention that people trade hidden metrics for observable metrics. And it's mostly to do with the gamification, the ability to track, like how visceral and how front of mind it is. But a good example of hidden metric would be the quality of the relationship with your significant other. Or time is an odd metric. It's kind of hidden. It's kind of not. Peace of mind, sanity, right? Quality of sleep, your ability to spend your attention where you want it to be as opposed to it being distracted. All of these things, right? Happily traded for a raise.

• 40:02Chris Williamson?

  Happily traded to change to a different job, which is twice the distance away. One of the biggest determinants in someone's life happiness is the length of their commute. Right. I learned that from Jonathan Haidt. Like, if you want to be happier, half your commute. Don't worry about the wage. And, uh, yeah, people will happily, well, I'm going to spend an extra, you know, 45 minutes there, 45 minutes back, which means an hour and a half that I'm not going to spend with my wife. And that's going to cause this amount of degradation of the amount of relationship satisfaction that we get. But 20 grand extra a year, or whatever, right? Hidden metric traded for an observable metric.

• 40:39Morgan Housel?

  And, and the fact that you can measure your salary down to the penny, and not only that, but I can compare mine to yours. So if, if we're in a society where it doesn't matter what I have, as long as I have more than you, I can measure that so cleanly. But what also matters to your life success, in terms of the quality of your marriage, your ability to be a good parent, your own happiness to sleep eight hours at night with a clear conscience, you, those things are very hard to quantify, if not impossible to quantify. But they matter more. So I think it's, I, I think all of that observable versus unobservable. It's that, that's what it is. It's just, we're searching for something that's so easy to quantify. And everything else, even if it matters more, it's out of sight, out of mind.

• 41:15Chris Williamson?

  George is trying to battle back against this by making the hidden observable. So he's got some type form thing that populates a Google sheet. It's peak autism. And he puts in at the end of the day, how many stars he was, did he wake up at this time? Did he do these things? And tries to track correlations and basically tries to bring the hidden into the observable realm. So he's forced to quantify that, which is usually just kind of like an ephemeral wishy washy notion. It's like this ambient fucking sense behind the back of his head. Um, so to kind of round this out, and I think it's a really, really important point. I'm so glad that you put it in the book. Presumably, there are two things that you can change, right? Either your expectations

• 41:59Chris Williamson?

  or your circumstances. You can either reduce your expectations down, or you can raise the quality of your life up on whatever metric it is that you're playing about with. Tactically, have you found any way to reduce your expectations?

• 42:13Morgan Housel?

  The only, the only thing that's worked for me, I wrote about this in the psychology money, was this, it was an observation that I had when I was a valet at a five-star hotel in Los Angeles during college. And there would be all these people driving in, in Rolls Royces, Bentleys, Lamborghinis. And I realized, I was like 20 at the time, but I realized that never once, when somebody drove in, in a Lambo, did I look at the driver and say, "Oh, that guy is so cool." What I did is I imagined myself as a driver. And I thought, if I was a driver, people would be looking at me and thinking that I'm cool. But it was like, wait, but I never do that for the dri- I just imagine myself. So then it was, nobody actually cares about the driver, but they want to be the driver, because they think people will then care about them.

• 42:56Morgan Housel?

  And it was just like, once you recognize that game, and the big takeaway is like, nobody is thinking about you as much as you are. They're busy thinking about themselves. And once you realize that, no one's paying any attention to the size of your house, or how nice your car is. Nobody's paying attention to your clothes. Nobody is paying attention to them as much as you are. Once you recognize that, then I think your desire to put out your peacock feathers like that diminishes. Not, not to zero. It's not to say you should look like a slop. It's not that in the slightest. It's just when you realize that nobody, nobody cares about your circumstances as much as you do, because they're busy worrying about themselves, then I think it's much easier to keep your expectations in check. And be like, why do I want to spend money on this thing that's going to make me look better, when nobody's even paying attention to it?

• 43:42Morgan Housel?

  Except maybe the people who, who are like, very close in my life, my spouse, my kids, my parents, who don't care about the clothes that I'm wearing. They love me for being me. So that's, like, that realization for me was like, okay, look, I like nice homes and nice cars. But when you recognize that game, I think your ambition for those just peacock feathers aspects of life, goes way down.

• 44:04Chris Williamson?

  Wild minds, people who think about the world in unique ways you like, also think about the world in unique ways you won't like.

• 44:13Morgan Housel?

  I started thinking about this years ago when people were like, Elon Musk is kind of rude on Twitter and he's saying the wrong things and he's not very polite to people. And like, of course, this is a guy who at age 30, took on GM, Ford and NASA at the same time and succeeded. Like, of course, he's not a well-balanced individual. Of course, he has these crazy quirks and of course, he thinks that the rules of society don't apply to him. Because that's what you like him for. The reason that people like and admire Elon Musk is because he doesn't think any of the rules apply to him. And he's willing to take these bonkers bets on new technologies and new engineering. And with that, an unavoidable part, an undivisible part of that,

• 44:55Morgan Housel?

  are these, are these parts of the world where he thinks about the world differently than you's in negative ways? And he can be a jerk and he has different political views than people. And you cannot separate those two. You cannot have somebody who is a crazy out of box thinker in a positive way and also dresses and speaks and looks and is polite like an average citizen. It does not exist. Every person who has outsized success is going to have some traits in them that are bad. Even if someone like Warren Buffett, he's like the, the best investor of all time, came at the expense of time with his family and his kids. Like, there's always, most people, I heard this quote the other day, everybody adds up to the same number. But there's like different ways to get there.

• 45:39Morgan Housel?

  And I think most people who are abnormally good at one thing are almost always abnormally bad at something else. Like it's, it like those numbers are going to even out in the end. So if you take somebody like Musk, who is like off the charts talented at engineering and risk-taking entrepreneurship, of course, he's going to have traits in which he is abnormally bad. In equal parts to what he is good at. And I think there are so few exceptions to that. Actually, think the closest that we've come to a crazy thinker who looked and acted like a normal CEO is Bill Gates. There aren't many others who are like that, where it's like, he was this crazy, hard-driving visionary, but he wore a suit and said the right things

• 46:22Morgan Housel?

  on conference calls. There aren't many people like that. Even if you looked at Mark Zuckerberg, like, he was one of the first who was just like, I'm gonna wear t-shirts and jeans. And even that little thing was just like, he didn't look the part of what he was supposed to be doing, because he's just like, I'm gonna do it my own way, I'm my own person. So for all of these people, there are traits. And to me, it's just like, be careful who you look up to, because you cannot pick and choose the parts of people that you look up to. So you can't say, this came from Naval, you can't say, I want his body and his mind and his wealth. You gotta, it all comes with the same package. So if you look up to this person and say, I want to be like that guy, well, you gotta take the full package, the good and the bad, they always come one in the same.

• 47:03Chris Williamson?

  That Naval sequence has inspired like, probably 10 blog posts for me. There's another one from Jason Pargan, which is great. Except that all of your heroes are full of shit. Your heroes aren't gods, they're just regular people who probably got good at one thing by neglecting literally everything else. So, you know, Tiger Woods, goat golfer, not a fantastic husband. Alan Watts, life-changing spiritual teacher, died of alcoholism early. James Joyce, guy that wrote Finnegans Wake and Ulysses, masterful author, but also posthumously, a bunch of fart fetish love letters that he wrote to his wife got released. Like, you know, you might want to be the best golfer on the planet, but do you want to be chased down the driveway by your wife,

• 47:46Chris Williamson?

  wielding a club that presumably you got for free from your sponsor? Like, you might want to have millions of people fall asleep to the things that you say in this beautiful British accent, but do you want to die early because of how much you drink? Or like, you might want to write blockbuster novels like Ulysses and Finnegans Wake. Do you want to have your innermost thoughts about the different types of farts that come out of your wife while you have anal sex with her be released to the world upon your death?

• 48:10Morgan Housel?

  No, no, no.

• 48:12Chris Williamson?

  I guess I imagine that you would say no.

• 48:15Morgan Housel?

  I read a lot of biographies of entrepreneurs and generals and presidents. Never once, not a single time, have I finished a biography of someone who achieved these mountainous heights in life and said, or thought, I wish I could have lived that life. And the opposite is almost always true. It's usually at the end of the book. It's like, you achieved a lot, but that was, that was an insane life that I never hoped to come within 100 miles of it. I just finished the Ken Burns documentary on Ernest Hemingway. And here's another, he was the author of the century. I don't think that's an exaggeration. And his personal life was the most despicable, miserable, immoral, drunken life that you can imagine. And of course, he ended by taking his own life.

• 49:00Morgan Housel?

  And, but the finer details of what his day to day life were like, nobody would look at that and say, that looks fun. It was, it was easy to glamorize the life of a writer, this big macho guy who loved bullfights, but like the actual love, like his love life, his family life, his alcoholism, his depression was terrible. It was awful. And I also don't think that you can detach how good he was of a writer from that alcoholic depression.

• 49:25Chris Williamson?

  It's driven by that.

• 49:25Morgan Housel?

  They were one and the same. It was driven by that. And it was, it was that messed up mind. It was that pain in his head that created the good writing that we all enjoy.

• 49:35Chris Williamson?

  What does it say that the people who we most admire are the ones who have the least admirable internal states?

• 49:45Morgan Housel?

  I think that that was kind of the point of this chapter. It's like, be careful who you look up to. And after that, I started trying to admire people in my life who I thought lived a good life, but were like, I mean this in the most polite way, like very average. They're like not, not the celebrity, not the billionaire entrepreneur, but who do I know who's just like, oh, that, that guy is a good husband and a good dad and he's in good shape. He takes care of himself. He takes care of his family. He's smart. He's educated. He's funny. And look, he doesn't make that much money. Nobody knows who he is, but let's leave that aside. The rest of his life looks amazing and it's something that I want for myself. I want to be a good husband. I want to be a good dad. I want to take good care of myself. So like rather than looking up to the famous celebrity, look up to the guy

• 50:29Morgan Housel?

  across the street who nobody knows. Like that's actually who's closer to be your role model.

• 50:35Chris Williamson?

  Yeah, the same personality traits that push people to the top also increase the odds of pushing them over the edge. And I found out that we're both mutual fans of John Boyd, who, if you want to talk about extreme personalities that achieved stuff, this is a guy who actually wrote the book on fighter pilots for the US Air Force during a kind of a glory period, right? Sort of 40s through to 80s, which is kind of like this era of fighter pilots. And he would smoke cigars. I think once there was a story that he just put his cigar out on one of his commander's ties.

• 51:12Morgan Housel?

  He was, he was, he was an absolute monster. There was some story, I might be getting some of these details wrong, but there was a story of he was in the barracks with his, with his, his fellow Air Force men and the, the heater wasn't good enough. It was in the middle of the winter and they were all cold and the army refused to put in new heaters. So he burned the barracks down. He lit them on fire and burned them just out of protest. And there's, there's all these scenes of like these little things of he would be in a meeting with his superiors, with generals, and he would be, he would like bite the callus off his hands and spit it across the table. Just like, he was just a monster of a human, but he was so talented at being a fighter pilot and he was so good at figuring out the math of the certain speeds and the trajectories of how you wanted your plane. But with that ridiculous talent came this personality that was like impossible for people to put up with.

• 51:58Chris Williamson?

  Wild numbers. People don't want accuracy. They want certainty.

• 52:03Morgan Housel?

  There's this great quote where Jerry Seinfeld and Jimmy Kimmel are driving in a car, and it's this old car. It's like this old relic of a car, this like this, this old custom car. And Jimmy Kimmel gets in and he said, he says, there's no seatbelts in here. Does that bother you? And Jerry Seinfeld says, no, but tell me the truth. How often in your life have you actually needed a seatbelt? And like, it's a joke. It's supposed to be funny. But in that is like, the world is governed by odds. It's not black and white. It's like if it like, of course, if there is a one one thousandth of a percent chance that you're going to need the seatbelt in your life, you should wear it every day. People understand that. But what actually gets people like to pay attention in life is just whether you are right or wrong. And you see this a lot in investing where it's like, I think there's an 80% chance that this stock

• 52:47Morgan Housel?

  is going to go down. But then if it goes up, was I, was I wrong? Like, no, like I, it's not a black or white thing. This happened in a big way during the 2016 presidential election, when Nate Silver, who is a very famous statistician who predicts elections, he said that the odds were that Hillary Clinton was going to win. And I think at the time, he said, there's a 70% chance or 80% chance that Hillary Clinton's going to win. Obviously, she did not win. And so the next morning, every headline was Nate Silver was wrong. Nate Silver got this wrong. Nate Silver blew his forecast. And he was like, no, I said, there's an 80% chance she's going to win, which implies there's a 20% chance that Trump is going to win. Just because that's what happened doesn't mean it was wrong. But most people will not accept that form of thinking. It's black or white. Were

• 53:31Morgan Housel?

  you right or were you wrong? And so that's like, it's a big flaw when people think about numbers in the world and data and statistics is that the world is governed by probabilities, but everybody thinks in just binary, yes or no, right or wrong. And it makes it so it's really difficult to know who to pay attention to. Like, you want to be paying attention to the Nate Silvers who think about the world in probabilities. And even when they are quote unquote, wrong, it's like, it's actually really tough to tell whether that was like a bad call. Like, he easily could have been right. Like, there was an 80% chance Hillary was going to win. That was probably the right statistic, even if it didn't turn out to be how it, like what happened in the real world. So the way that people think about numbers is like screwed up in all kinds of ways. And it just makes

• 54:15Morgan Housel?

  it, that's part of the reason that we're so bad at predicting markets and politics is like, the world is governed by probabilities, but we always think binary, right or wrong.

• 54:24Chris Williamson?

  I think there's something seductive about a person who is able to speak in binaries and black and white as well, because it seems like certainty, which is a good proxy for expertise. And you don't actually know, like, if everyone's just throwing shit at the wall and my shit's sexier than your shit, even if my shit's wrong, it's going to garner more attention, right? I see this online with, you know, other cultural commentators and people that do YouTube and podcasts and stuff. I'm very, I'm chronically uncertain of everything about, and it's why I don't really make big proclamations about much that I don't have an area of expertise in. Didn't bother commenting on COVID, didn't bother commenting on Ukraine, didn't bother commenting on Israel, because I don't think that the world needs more noise, it needs more signal.

• 55:08Chris Williamson?

  And uneducated idiots like me, who don't have specific knowledge within that domain, giving cod psychology opinions about it is precisely the problem that we're trying to battle back against.

• 55:20Morgan Housel?

  That's exactly right. You had a post on Twitter recently that was just about this for what's going on in Israel. Where you said, I don't, I don't know enough to comment on the situation. And I know there were a lot of people who took issue with that.

• 55:33Chris Williamson?

  Well, how, how can you not know more about this situation that you don't know more about? I, I don't know, it is what it is. But I think, yeah, the world would be a much better place if people that didn't know what they were talking about tried to not talk about the things they don't know about. And we all get out over our skis, right? You know, that same thing I spoke about earlier on, like, if you, if you're someone who has, at young, medium or old age, garnered a little bit of attention, like, why shouldn't I, why shouldn't I give my thoughts on epidemiology? Why shouldn't I give my thoughts on the lab leak hypothesis? Why, why, why don't they want to know about my, my, my opinions on immigration? You know, they're very, very interesting when it comes to productivity or focus or whatever the hell else it is that you talk about and you think.

• 56:16Chris Williamson?

  Again, with that, there's a seductiveness to fluency in particular, but absolutely certainty too. There's this guy called Peter Zian, real interesting guy, geopolitics dude. And I don't know enough to be able to stress test his ideas, but I know one thing, he's one of the most certain humans when it comes to speaking that I have ever heard. And he came on the show and I found him very compelling, but I don't know much about, what are we gonna do? Go dig into the fucking demography of China and be like, oh, actually, I think it's not going to be 650 million, it's going to be 750. Like, I'm not going to go do that, right? But

• 56:57Morgan Housel?

  Right.

• 56:58Chris Williamson?

  There, I remember thinking at the time while speaking to him, and I've kept in touch with him, I think he's a very interesting dude. Wow, like this guy speaks with so much certainty and he has vehement fans on the internet. And I think it goes right back to what we said at the very beginning, which is people abhor a vacuum and they abhor uncertainty. And if you can give them something that seems like order wrangled out of chaos, oh, you, you're, allow me to become an evangelist. Like, you know, I will pray at the altar of the person who can tell me what's going to happen.

• 57:33Morgan Housel?

  Yeah.

• 57:34Chris Williamson?

  I mean, this is, this is cults. How many fucking cults are like, the world's gonna end on the 21st of December 2012, or whatever it is. And then it doesn't happen, but the certainty was so much there that the seduction continues, even when the certainty was proven to be wrong.

• 57:48Morgan Housel?

  Even when they're wrong, because what people actually want, they don't want the truth. They don't even want an accurate forecast. They want to reduce the uncertainty that exists in their head at this moment today. And so even when the pundit is wrong, people don't care because the pundit already did its job of reducing uncertainty when they went on TV last week. And so that's, yeah, that's, that's a big part of this. If you go on TV and you say, There's a 20% chance of a recession next year. That will be your last time on TV. But if you say 100% chance and it's going to be bad and it's going to affect these people in these industries, your phone will ring off the hook because you've just reduced uncertainty, even if what you are professing is something that's pessimistic and is scary. If you say it with certainty, people are like, that's who I want to pay attention to.

• 58:32Morgan Housel?

  I think a lot of religions are probably like this too. Like, like, most religions don't say there's a 20% chance that heaven exists. It's, it's, it's, it's, this is exactly what's going to happen with 100% certainty and there's no wiggle room.

• 58:44Chris Williamson?

  The Church of Havel, I, I defend that.

• 58:48Morgan Housel?

  And but, but that it reduces uncertainty when you know for certain exactly how the world works and what's going to happen in the future, what's going to happen in the afterlife. There's a very comforting aspect to that, that removes uncertainty that is so unpleasant to deal with in your head.

• 59:02Chris Williamson?

  What is it about the sufficiently big sample size playing out thing that you talk about?

• 59:09Morgan Housel?

  One of the things that's always struck me is that since the end of World War II, when we've had pretty good economic data of like, we track the economy with a lot of precision. There have been, I think, nine recessions, which is not that many. Like, the sample size that we're dealing with right now is ridiculously small. And if you wanted to really be an expert on economic history, you would, if, if, if you had like a wish from the genie, you would say, give me 100,000 years of apples to apples data that I can study the economy. Like, let me study the last 10,000 recessions. But of course, we don't have that. We have good data on nine of them. All that were each that was caused by like a very specific thing. So it's, we really don't, for something as fundamental, like, and important for society as recessions and economic growth.

• 59:54Morgan Housel?

  The truth is, we really don't know that much. We don't know what a really bad recession looks like. We don't know the peak of our, of our potential or like how fast the economy can grow. Our sample size is so limited, but since it's all we have and because it's still 80 years worth of data, it seems like a long period of time. It's very tempting to say the average recession lasts for eight months or whatever it is. It's very tempting to say the average recession unemployment goes to 8%. But when you look at that average, what that average is, like, there is so much else that could happen for good or bad, like the economy being way stronger than we think it could be or way worse than we think it could be. Once we realize that the data that we're looking at of economic history is so limited.

• 1:00:40Chris Williamson?

  You talk about unfortunate odds and recklessness and kind of distinguishing between the two. I think retroactively, even if we can see what occurred in the past, it's so hard to try and work out the correlation. Okay, was, did these two things just happen together? Or did this thing actually cause this thing to happen? Was it unfortunate odds? Was it recklessness? It makes this entire situation really messy.

• 1:01:08Morgan Housel?

  Yeah, the one I think about a lot is that in 2007, I think it was, Mark Zuckerberg was offered a billion dollars for Facebook and he, of course, turned it down. And we look at that and we're like, what a fricking genius he was because now the company's worth a trillion dollars or whatever. Like, one of the smartest decisions that you could ever make. But during that same time, Yahoo was offered $50 billion for Microsoft. Then Microsoft wanted to buy Yahoo and Yahoo turned it down. And we look at that and we're like, you idiots? Like, of course, you should have taken it because now, I don't know why Yahoo's worth, but it's not within 20 miles of $50 billion. And so you look at that and it's like, well, how do we know Mark Zuckerberg made a great decision and Yahoo didn't? Like, there's such an easy world to imagine in which Facebook was a

• 1:01:52Morgan Housel?

  flash in the pan and Yahoo became the next Google. You could easily imagine that world. It didn't happen, but it easily could have happened. So when we look at these retroactive decisions and say, these retrospective decisions and say, look, Mark Zuckerberg was so smart and Yahoo was so stupid. It's not that clear, even if that's what actually happened. There are all these alternative histories that not only could have, but should have happened, that could have made that narrative so much different than it is.

• 1:02:17Chris Williamson?

  Everyone's post hoc rationalizing everything all the time. The more that I've dug into personal growth and development and been around successful people, the vast majority of what people are doing is, I have found a particular strategy that resulted in success for me.

• 1:02:36Chris Williamson?

  Given my idiosyncrasies and paths of least resistance and genetic predisposition and upbringing and culture and timing and gender and all of that stuff, let me now create universal laws for everybody that is a retrospective justification of how what I did that gave me success is something anyone can do that can give anyone success.

• 1:02:58Morgan Housel?

  When like the irony is like, the reason that you are successful is because it only worked for you. If that could work for everybody, everybody would do it and that skill wouldn't matter at all anymore. Like the whole reason that this person got successful is because nobody else could do that thing that they're now trying to turn into a universal law. So I think there are some things that we can learn from these, these major successes. Like if you're looking at Warren Buffett, the, the traits that you want to learn from is like his patience, his endurance, but I, I don't think you should learn his stocks picking skills because so many of those skills were honed in 1950, when this market was completely different than it is today. So that's why, you know, one of the most famous investing books is The Intelligent Investor by Benjamin Graham.

• 1:03:40Morgan Housel?

  And it was first written in the 1930s and there is of course, a lot of timeless wisdom in there. But there's also a lot in those books that is like hyper-specific to the economy in the 1930s and the 1940s. That if you tried to implement those formulas today, you'd lose everything. It was, it was just relevant to that period of time and it's not something that you can scale into a universal law.

• 1:04:03Chris Williamson?

  Best story wins. Stories are always more powerful than statistics. Why?

• 1:04:09Morgan Housel?

  It drives you crazy if you think the world is going to be governed by the right answer and the best answer. And if I can just come up with the right answer, like that's what's going to change people's minds. And it's almost never the case. It's always the case that what actually like gets people to nod their heads is just whoever's telling the best story, the most compelling story. And even if, if the person is like, it's not to say that they're fooling people. But if, if you have the right answer and you're not a good storyteller. You may or may not get ahead, but if you have the right answer and you're a good storyteller, sky's the limit. Like, those are the people that really run with it. It's so easy to discount the power of a good story because it's a soft skill. Like, a lot of analytically minded people think if I can just find the right answer in the spreadsheet, if I can just create the product

• 1:04:54Morgan Housel?

  that works the best, everything else will take care of itself. And it's not how it works. We were talking earlier, I write about this in the book, Ken Burns, who I think is just absolute genius documentary filmmaker, and everything he's ever made is just 10 out of 10. It's so good. And one of the things he does so well is incorporating music into his documentaries. And he's talked about this before, where he will literally change the sentence structure of a script so that a specific word that the narrator is saying matches with a specific beat in the background music. The emotional word matches the emotional beat at the same time. And no other filmmaker, no other historian is doing that. Most historians would just say,

• 1:05:36Morgan Housel?

  if I have, if I find the right information in the, in the library, like, that's, that's, that's what I'm going to present. And Ken Burns is like, no, this is going to be a performance. And because of that, I, I, I make this point that almost nothing Ken Burns has ever published is new information. He writes about, or he's made films on the Civil War and World War II and the Holocaust. These are very heavily studied events. Everybody knows, everyone knows how the story ends. But his magic is that he's the best storyteller that exists of any historian who's ever existed. And because of that, when the Civil War documentary came out in 1990, Ken Burns Civil War Documentary, more Americans watched it that year than watched the Super Bowl. And this is about, this is about an event, the Civil War, that everyone

• 1:06:20Morgan Housel?

  has been reading about since grade school. There's no new information in the documentary, but the storytelling is so captivating that it, it moves mountains. I think this is true for Michael Lewis, too, of, there's, there's been no better business storyteller in modern times. And look, with some of what's come out recently, like, he doesn't necessarily always get the story right, per se. It's, it can be easy to criticize him. But maybe this is just because I'm a writer. I just finished Going Infinite, the book about FTX. And even if, yes, there are parts, like many other people, where I thought he was being unfair and supporting SBF in ways that I didn't agree with. But his storytelling is so good. His sentence structure is so good. His writing is so poetic

• 1:07:03Morgan Housel?

  that I will read it all day long, no matter what it comes out with. Like, the best story is always gonna win.

• 1:07:08Chris Williamson?

  I feel like that when I read yours, man. I adore the simplicity of your sentences, whether it's on your blog, Collaborative Fund, and there's a newsletter that I subscribe to. I want to say sorry to whoever else writes for you, because my first thing is, I click, if it's not got Morgan Howson written at the top, I just ignore it. And the only ones I read, I'm sure the rest of the writers are really great, but I just focus on you. Yeah, the simplicity of your sentences, even some, I guess you would, you break convention in your books, especially in the new one, uh, single lines, three or four word lines that are paragraphs all on their own.

• 1:07:43Morgan Housel?

  That was, that was very intentional and the, and the publishers don't, don't like it. But that's how I like to read. And I think it's, I think what a lot of readers really want out of a book, or what really makes them feel good is making progress. They're like, oh, I finished this chapter. I finished this level, moving on to the next. And when you have, when you turn a page and it is solid uninterrupted block of text, it's very easy to be like, oh God, like, what do I got in front of me?

• 1:08:06Chris Williamson?

  Not today, Satan.

• 1:08:08Morgan Housel?

  But when it's quick, when it's a quick line, it's just boom, boom, boom. It's much easier to A, feel like you're making progress. But also, it's just an easier format to read in. You can just kind of breeze your eyes over the page and soak it up, rather than like really dense, powerful reading. So I think that structure is, it's part of it. And I, yeah, you're right. I don't think most readers think about the length of their structures or the, the, the, the visibility of what a paragraph actually looks like, like, like, like a block of text. But it's critically important to the, the, the reading experience.

• 1:08:40Chris Williamson?

  Yeah, your books have a particular robustness to put downingness. Like, it's very difficult to put them down for precisely that reason. There's a little bit more, there's another little thing. Oh, there's a story about fucking World War II. Like, let me get into that. And yet, for my newsletter, I stole a bunch of ideas, yourself, James Clear, Ryan Holiday, even some of the conventions that he uses. And, um, the newsletter. This is kind of common, commonly done now, but it's one sentence per paragraph with smaller line breaks in between and it's just straight through, super easy, very nice to read, tight margins.

• 1:09:20Chris Williamson?

  So yeah, like stuff like that. And we were talking before we started about the story that I try and tell with these big productions that I do on the show. You know, I want to, we choose the location of these particular

• 1:09:34Chris Williamson?

  venues based on the guest that we're speaking to. So, you know, we have Patrick Bet David coming on and he's kind of like a, like a, a power guy, like a power broker kind of guy. He's like a mafia boss. So I wanted a wall of books, right? Or we, we have an Andrew Huberman coming on, who's kind of this interesting blend of sort of science and precision with kind of like raw, masculine, kind of like grittiness, like in terms of the way that he presents. So we found this beautiful warehouse with exposed wooden beams. So it's kind of got that rawness to it, but it's organic as well. And it feels, it's sort of humanizes it. Or we do Peterson and we did him in, in the Alamo in San Antonio. And it's got this sort of beautifully ornate

• 1:10:17Chris Williamson?

  blinds behind him, this sort of wooden blinds that's casting this very particular kind of light through. So, you know, we're trying to do something to just create this little bit more

• 1:10:28Chris Williamson?

  of an event, of an occasion. But you're totally right that, you know, many of us, me included. How many times have we felt resentment for somebody who we think has achieved success that they don't deserve because of the way that they look? Or because of something which is outside of the substance of what they're doing. You know, all style, no substance is a meme for a reason. And, you know, with Ken Burns, you could spend forever designing the sentences to hit the beat of the, the music and do all the rest of the stuff. But ultimately the reason that it works is because of the story that is then packaged in the way that's appropriate. And going back to what we were saying before about certainty, fluency is another thing. You know, if you've got some beautifully fluent person, you've got this great story about Martin Luther King.

• 1:11:12Chris Williamson?

  Right? If you have someone who's unbelievably fluent, not forgetting that he went off script in his famous, I have a dream speech and he almost, he gives himself a pattern break, right? He starts doing it, follows the script, goes, ah, no. And then freestyles it like that's it the fluency literally outdid the rational prescribed well thought out arithmetic stuff.

• 1:11:40Morgan Housel?

  The good, the script that he and his speechwriter wrote that day is what he started to speak from. And then there was a gospel singer in the crowd, a couple of lines in front of him who was a friend of Martin Luther King. And you can actually hear this in some of the videos. At one point in the, in the speech, she, she turns around and she says, tell them about the dream, Martin. Tell them about the dream. And you can literally see this in the video at that point, he takes his script on the podium and he moves it to the side. And then he looks up to the sky and he starts saying, I have a dream. And then the rest is history. And he had actually practiced that, I have a dream. So it was another speech that he had given before. But in the moment, I think he could just sense that the speech that he was prepared to give was not the best one that day. And that the gospel singer Malaliya Jackson was, was, I was right. That the I have a dream was the one he should have been doing.

• 1:12:25Morgan Housel?

  And he just started freewheeling it and became literally the most famous speech of modern history.

• 1:12:30Chris Williamson?

  How are stories like leverage when you've got a complex topic?

• 1:12:36Morgan Housel?

  It's, it's like leverage because you can squeeze more value out of them than you could just get by just putting raw data on the table. So, I mean, you can, you know, if I think, I think a lot of entrepreneurs will think if I'd have a successful company, I need to come up with something brand new. Like the reinvent the wheel kind of thing. And a lot of times you don't, you can take a pre-existing product and just tell a better story with it. Like boom, you're off to the races. That's great. And so there's, once you realize how much leverage you can get out of a story or, and how powerful a story can be. You're like, the, the field of opportunities in front of you is endless because you don't need to come up with something brand new. Ken Burns is, is the 10,000th person to document World War II. But he did the best job of that because he, he told a story.

• 1:13:19Morgan Housel?

  If Ken Burns had to find new history, find a new event that you've never heard of for his things, like forget about it. You can't do that. But if you can use a good story to leverage, it's already out there. You can become the most famous storyteller of your era.

• 1:13:31Chris Williamson?

  What's the complex bit? How, why is it when a topic is complex, stories are like leverage? Do they help to synthesize down confusion?

• 1:13:41Morgan Housel?

  Yeah, I mean, I mean, most people's tolerance for complexity is so limited. And everyone knows like the dull professor who just talks in P values and is just like writes in charts and is so like monotonous. And if you can switch that out with a good storyteller, like off to the races, like there, there's so much that you can do in there. So it's particularly in the complicated topics that are boring and dry and dull. This is why Richard Feynman was such a genius. He took physics, which is so boring and so dull for most people, but he could tell a story about it. There's this video online, you should, people should search for it. It's, he's explaining the physics of fire of like, like, how does fire actually work? And I, I'm not going to do it anywhere near the justice, but he's like, imagine a trampoline

• 1:14:25Morgan Housel?

  with two bowling balls on it and they're both like competing for space and they're running into each other. And when they're running into each other, like they move around and he's describing how molecules interact with each other that creates fire. And I didn't, I didn't do the, the, the accurate job there, but when he does it, you're like, oh, that's so entertaining. And by the way, I understand the physics of fire now in a way that if I just pulled out a physics textbook, I would have been like, so I, I don't understand it. And even if I understand it, this is so boring to read.

• 1:14:51Chris Williamson?

  Hmm. Yeah, I like that. And again, the best diet is the one you stick to. The best fitness plan is the one that you follow. The best habit is the one that you're compliant with. Ultimately, in order to be able to get whatever the information is that you want across, you need to play the game using the rules. And the rules include all of the lack of attention and boredom and ease of distraction and everything else that humans have. Eric Weinstein said this to me about, um, in a stickiness arms race, the most sticky message is the one that wins, not necessarily the one which is most accurate. And, uh, you know, this is how cultural memes take hold. Like I have a friend, Mary, who says meme first, explain later, which is why coming

• 1:15:36Chris Williamson?

  up with a name for something, a great name, oh, we'll retrofit the idea to the fucking name, like get the name, uh, because presuming that like, if the idea is bollocks, it doesn't matter. It's the packaging in many regards, and I think the storytelling side. But you know, I still see inside of me that, oh, this almost like a purity, like a puritanism to like, this is the way that it should be done. It should be, you shouldn't need to dress up the facts. It should just be the raw data and the fact that it's truthful and honest, blah, blah, blah. And it's like, no, dude, like, this thing's got to be sexy. Victoria's Secrets, even they are rolling back their change in branding from the last couple of years. They're pivoting back towards sexiness. So.

• 1:16:19Morgan Housel?

  Very, very famous example from Steve Jobs with the iPod, where you could have called it digital MP3 player. But instead, what Steve Jobs said was a thousand songs in your pocket. That's just a story. And like, for the people who are just like, we don't need to dress up the technology. It should, it should exist on its own. They would have called it digital MP3 player, which is probably what Sony and Panasonic did. And Steve Jobs said, a thousand songs in your pocket, which everyone can easily be like, oh, that sounds great. I love it. That's what I want. It was just such a brilliant era of storytelling.

• 1:16:50Chris Williamson?

  Does not compute. The world is driven by forces that cannot be measured.

• 1:16:56Morgan Housel?

  There's so many examples when you're watching a group of people or an individual do something and you're like, why are you doing that? Makes no sense whatsoever. You should have quit long ago. You shouldn't be doing it, but they keep doing it. And if you expect that every person is a rational thinker and they're doing things that make sense, that add up on the spreadsheet, you're going to go through life completely bamboozled at the number of people who don't. And so I use this example in that chapter of during, at the end of World War II, the Battle of the Bulge, when the Nazis attacked the Allies, there was a big, they made a big counter offensive. It was a complete surprise to the Allies. They really never saw it coming, which is why the battle was such a big deal. And the reason they saw it coming is because the US generals, the Allied generals,

• 1:17:38Morgan Housel?

  thought there is no rational world in which the Germans would counterattack right now. They don't have enough troops. They don't have enough supplies. They don't have enough fuel. The weather is atrocious. The geography is not in their favor. So therefore, we assume they're not going to counterattack. What they missed was that the Germans were not rational thinkers at the time. Hitler was not a rational thinker. He was completely out of his mind. And so because, because the Allied generals assumed that their opponent was rational.

• 1:18:05Morgan Housel?

  They they they missed what actually happened. That's why they were so vulnerable. So going through life, assuming it's the same with market bubbles. If you assume that people are rational with their money, like, of course, they're not. Then you're going to be completely bamboozled when, once a decade, there's a massive bubble and people light their money on fire and you can't figure out what's going on. Well, what's going on is like, things just don't compute. There's a human element, like, the world is not governed by spreadsheets. There's an emotional hormonal human element that's very hard to track, impossible to measure, but has some of the biggest outcomes in any of these activities in life.

• 1:18:39Chris Williamson?

  Who's Archibald Hill?

• 1:18:42Morgan Housel?

  Archibald Hill was this crazy, he was, he's such a cool guy. He was a physiologist about 100 years ago, and he was a big runner. He was, he was an athlete. And because he was a physiologist and an athlete, he devoted a lot of his career to just trying to answer the question, how fast can people run? Given like, given my body, given my aerobic capacity, or given your body, what's the theoretical theoretical limit on how fast we can run? And he came up with all of these formulas. He was kind of the early for a guy who came up with VO2 max, which which a lot of people are familiar with now, to really measure like, how people process oxygen, how it's dispersed throughout your body, the lactic acid buildup in your legs. And he came up with a formula for how fast people can run. And it was very accurate. So people like these athletes would come into his laboratory and he'd run his tests.

• 1:19:27Morgan Housel?

  And he would say, you know, making this up, he'd say, Jim, you, the fastest you can run a mile is six minutes and 32 seconds. And Jim would go on the track and give it all he's got. And he'd run it in six minutes and 32 seconds. Like, this formula was very accurate. And Hill actually won the Nobel Prize in Medicine, I think, in 1922. But there was this quirk about it in that his formula was never able to predict a race winner, like, in a competitive race. You could not use this formula and predict who is going to win the Olympic gold medal in track. And I think this is kind of bothered, it bothered a lot of people in the field and bothered him as well, that this formula was so accurate on the, on the track, on the test track, and had no accuracy in the real world. And they eventually figured out what was going on here, which is that in a competitive race,

• 1:20:11Morgan Housel?

  like the Olympics, when the stakes are very high, people get nervous, they get excited, they get rushes of adrenaline, they get all these other emotions that cannot be replicated on the test track when the stakes are low, that completely alters your performance. And therefore, like, hi- his whole takeaway was... Your aerobic capacity, your ability as a runner, is not just about your machine, your body. It's your body within the context of all your in the moment incentives and the crazy hormones and feelings going through your head. It's those two things in combination that creates your actual capacity. So I phrase this too of like, if you said the fastest you can run a mile is six minutes and 30 seconds, and you say like, I gave it everything I've

• 1:20:54Morgan Housel?

  got, I can't do it faster. But then if I said, hey, if you could do it in six minutes and 31 seconds, I'll give you a million dollars, you'll figure out a way to do it. Like, like, once the incentives change in the moment, you become a completely different person. And so I think that applies to a lot of things in life, and it's why things don't always compute. It's not just a spreadsheet. You have to figure out what's going through people's heads.

• 1:21:15Chris Williamson?

  So, logic has its limits, and our ability to be rational and make predictions is always going to bounce up against things that aren't able to fit inside of the model.

• 1:21:26Morgan Housel?

  Always. And it drives people crazy. This is just like best story wins, where if you if you assume the world is governed by logic, you're going to be led astray your entire life, because it never is. Whether it's the Germans deciding to attack when they shouldn't, or trying to predict athletes' performance. I grew up as a ski racer. That was my sport. Not a very popular sport in America, but that's one I follow. And the greatest ski racer now of all time is a woman from the United States named Michaela Shiffrin. And she's the greatest skier, man or woman, in history. She's an absolute beast. She's incredible. And she has this thing that she's spoken about this publicly. It's not a secret, that when the stakes are very high, like in the Olympics or the world championships, she, before the

• 1:22:09Morgan Housel?

  race, will vomit. And it's a thing, she gets so nervous that her body just, you know, just kind of gives up. And obviously, that has a huge impact on like, your hydration and your energy levels if you're throwing up before the races. And one of the takeaways is like, Michaela Shiffrin on the test track. When she's training is not the same skier as she is in the Olympics. Her entire mindset is utterly different. And even like the physical composition of her hydration is completely different. Because when the stakes get high and people start getting nervous and emotional, they become completely different people. So you would think that her skiing ability would just be like the strength of her core and her agility, her flexibility. And it's not like 90% of it. It's just what's going through her head in the moment.

• 1:22:52Chris Williamson?

  I have a DJ friend who for a long time wanted to be on Eric Priz's label, very much idolized him. And then after a decade and a bit of working and producing and making songs, he ended up doing it and now supports Priz all around the world. He's played Madison Square Garden, New Year's Eve shows with supporting Eric at his hollow projector thing. And there was a good chunk of time where he would throw up before he went on stage as well. And you know, you see him backstage and he's just this super cool guy. He's like sort of a buff, like northeastern British dude. And before he'd go up because he cared, right? He cared so much about what he was going to do. And you look at, you know, the component parts of this particular person's talent and go,

• 1:23:36Chris Williamson?

  ah, you know, they are the function of this and this and this and this and this. And you say, yeah, but what about the context? And what about all of the other stuff that you can't imagine? Thinking about the crazy battle of the bulge and the insanity of Hitler. Have you ever looked into Theodore Morel? That was his personal physician.

• 1:23:57Morgan Housel?

  I've heard a lot about it just because I know Hitler was drugged out of his mind, particularly in the last years of his life, but I don't know many details about it.

• 1:24:02Chris Williamson?

  Dude, if you have, if you come across a Theodore Morel documentary, there's a few of them on YouTube that are great. It's amazing. This guy was a total quack. He was injecting Hitler with bull semen. He was like on meth, injecting him with cocaine like multiple times per day. Does this really? Interesting interaction between Hitler and Mussolini. And it's one of these turning points in the war. And I think that Hitler kind of goes really, really crazy and flies off the handle and all the rest of it. And it's thought that Morel had overdosed him with some drug. So I often think about, you know, just how much of what happened, obviously Hitler,

• 1:24:46Chris Williamson?

  not internet, I'm not justifying Hitler, but I do.

• 1:24:50Morgan Housel?

  Don't chop this video up.

• 1:24:52Chris Williamson?

  Yeah, I know. I do sometimes think about how much of the madness that we saw coming out of Nazi Germany was actually, you know, due to one particular quacky physician's cupboard and then what he chose to do to the leader of the Nazi party.

• 1:25:09Morgan Housel?

  And even for regular run of the mill soldiers, it's, there's another thing where it's like, it's impossible to know how you're going to react and respond until there's bullets flying over your head. There's no amount of training and preparation that's going to prepare you for that.

• 1:25:23Chris Williamson?

  You'll, you'll know this. Isn't there some insane number of soldiers that went to, was it maybe Vietnam didn't fire or they were firing in the air, they were purposefully not firing at the enemy?

• 1:25:34Morgan Housel?

  I forget the exact percentage of it, but that was true in World War Two, where they could tell even the soldiers that were in frontline combat, how many of them actually pointed their gun at the enemy and pulled the trigger? It's a very low percentage. And I think I would be willing to bet that a lot of those people probably knew it going into it. I don't know if I could kill another human being, but I bet there are a lot of it who went in with a lot of bravado and saying like, I'm, I'm going to do this.

• 1:25:56Chris Williamson?

  Targets in training, I can do it.

• 1:25:58Morgan Housel?

  Hit the targets in training. And then you see the whites of the enemy's eyes and you realize it's just another kid just like you. And all of a sudden you say, I don't, I don't know if I could do it. And who are you and I to say that we wouldn't do the same thing? If you've never been in that situation, you have absolutely no idea.

• 1:26:14Chris Williamson?

  Calm plants the seeds of crazy. Crazy doesn't mean broken. Crazy is normal. Beyond the point of crazy is normal.

• 1:26:22Morgan Housel?

  It's just this idea that the reason there is so much volatility in a lot of things in life, but particularly the economy, the reason that we have booms and busts, the reason that we have recessions is because we have periods of calm. And when the economy is calm and people are really optimistic, they, once they become optimistic, they go into debt because they're optimistic about their future. Of course, I could pay off this debt. Once they go into a debt and their optimism grows, the economy becomes unstable. Once the economy is unstable, of course, you're going to have a recession. So it's this weird thing, like in, in a world in which there were no recessions, no bear markets, stock market never goes down. That is the world that guarantees the next recession. Because think, if, if, if we passed a law, completely hypothetical, we pass a law, the stock market cannot go down anymore. The stock market can only go up.

• 1:27:06Morgan Housel?

  The rational thing to do in that situation would be to mortgage your house and sell your furniture and buy as many stocks as you could. Because they, because they're guaranteed to go up. Once you do that, the valuations go to the moon. Stock prices get bid up to the stratosphere. And once the valuations are that high, they're guaranteed to crash. So this is like the irony of the reason that you have market crashes is because there's periods of calmness. And calm always plants the seeds of crazy. And it's so tempting to look at every boom and bust, every bubble, every market crash, and say, people were crazy. Like, who do we blame here? Like, who screwed up? And I just think it's such a natural phenomenon in, in economies. There was this economist back in the 1960s named Hyman Minsky from the University of St. Louis.

• 1:27:50Morgan Housel?

  And during the 1960s, there was this big idea that we are going to eradicate recessions. That was a big idea in economic circles. And Minsky basically said, it's all bullshit. That will never happen. And his, his theory was called the financial instability hypothesis. And he laid out what, what I just said. If there were no recessions, people would go into debt because they're optimistic. Once they go into debt, the economy is unstable. Once the economy is unstable, you're going to have a recession. So because of that, it's just like such a clean chain of events that you can never eradicate recessions. You can't eradicate booms and busts because calm always plants the seeds of crazy.

• 1:28:26Chris Williamson?

  Yeah, you've got this idea about paranoia leads to success because it keeps you on your toes. And I guess this is a, an uncomfortable realization that.

• 1:28:38Chris Williamson?

  Part of the reason that we are able to survive the chaos of the world is precisely the emotion that we are trying to mitigate. Like our paranoia is the competitive advantage which is keeping us going.

• 1:28:52Morgan Housel?

  It's this irony of like, people are super paranoid about their career or the business that they started. And if you were to sit them down on the therapist's couch and say, why are you so paranoid? They say, because like, I have this anxiety and I want to be successful because once I'm successful, I won't have this anxiety anymore. I need to become rich so I don't have to worry anymore. So they become super, they, they, they wake up scared every morning. And because of that, because they wake up scared and driven, they're going to become super successful. And then once they get to some level of success, they say, now that I've made it, I can relax because I've made it. This was the whole point of getting rich was so that I could relax. And then once they relax, the thing that made them successful, which was the stress and paranoia is gone. And that's, that plants the seeds of their demise.

• 1:29:34Morgan Housel?

  And that, and you see that with so many companies, like companies that get fat and happy and lazy and they become the absolute top of their game. And then they just become, they, they, they, they start to become oblivious and then they start to lose it. Sears is one of the best examples of like, we don't think about it much today, but Sears, which is a department store, was the biggest department store in the United States, similar to Macy's or something like that. And it was the most dominant retailer that has probably ever existed. I think Sears in its heyday was more dominant than, than Walmart or Target or anything like that. And now it barely exists. It still technically exists, but it's an absolute shell of its former self. And if you look at the history of Sears, that's really what it was. It's like a hundred years ago, they were scared and scrappy and that's what made them so successful.

• 1:30:18Morgan Housel?

  And then they became so dominant that they just got lazy. And that, and that of course led to their, their, their fall. Same with IBM, same with General Motors, same with AIG. It's like, be careful what you wish for, for that, because a lot of times the reason that you are so successful is because you have this trait that you are so eager to get rid of once you become successful. And once, once that happens, like boom, it's all over.

• 1:30:41Chris Williamson?

  Well, there's another question, kind of the reverse of this is a question around, if we sacrifice the thing that we want for the thing which is supposed to get it, what the fuck are we doing? Like if we sacrifice happiness in order to be successful, so that when we are finally successful, we can allow ourselves to be happy. If this was an algebra equation and I just removed success from both sides of the equation, you would just be left with happiness, right? It's the parable of the Mexican fisherman.

• 1:31:08Morgan Housel?

  I was gonna say the exact same thing, but this is that this is an area where it does not compute enters the picture because life isn't an algebra equation. If if people just did the equation, what you just said would make perfect sense and people would be the Mexican fishermen. But it's it doesn't compute. There's this element of because from what we were talking about earlier of like people's goal is not to become successful, it's to become more successful than other people. So there's never going to come a point where people say, oh, I'm completely satisfied. I can just sleep in and do some fishing and hang out with my wife. It's always going to be, I have to get to the next level. I have to beat the next person next to me.

• 1:31:42Chris Williamson?

  Yeah, there's a scene in Rick and Morty where they play the game of Roy. You heard of this?

• 1:31:48Morgan Housel?

  No.

• 1:31:48Chris Williamson?

  Seen this, it's it's super legendary on YouTube. It's a one minute long clip. You can watch it. It's just Rick and Morty Roy. It'll come up and it's a computer game where you play an imagined life as this guy and he works as a carpet seller and Morty goes and plays it and he's a football player and then he has a heart attack in a carpet store and then he goes back to the carpet store and he comes out and Rick says to him, never go back to the carpet store, Morty. And then he gets in and this crowd sort of gets around his VR thing and they say, oh, my God, he's taken, he's taken Roy off grid. Roy doesn't even have a social security number. And it always makes me think about people that are playing the game and people who have somehow managed to break the thermodynamics of the game.

• 1:32:33Chris Williamson?

  And the thermodynamics of the game, like a good person that I think is at least in part broken them, Ryan Holiday and Tim Ferriss both come to mind.

• 1:32:43Morgan Housel?

  Really? How so? Because I I'm not that close, but I know both of those people. How so?

• 1:32:49Chris Williamson?

  So Ryan appears to be someone who has purposefully kind of like Cameron Diaz,

• 1:32:55Chris Williamson?

  reduced the trappings of fame, ramped up simplicity as best he can. And he'll have his demons and goblins and all the rest of it, right? Just like the rest of us. And there's layers and layers and layers of whatever self work to get to. But it seems to me like he purposefully leans into doing simplicity like he has his routine. He knows kind of where his His mission lies and that seems to work the same with Tim that, you know, Tim has largely taken a pretty big step back from super public life. You know, he's not guesting on tons of podcasts. It doesn't seem like he's writing a book at the moment, or at least he hasn't done for a little while. You know, he still does his show, but even that it's, you know, it's not so

• 1:33:37Chris Williamson?

  much about the YouTube and the, and the Instagram stuff. It's like his audience and he owns this part of, of, of the audio stuff. Um, you know, I remember reading 13 Reasons Not to Get Famous, one of my favorite ever blogs.

• 1:33:48Morgan Housel?

  It's, it's so great. It's so great. I, I, I take it back. I thought you were using those people as examples of people who got trapped into fame, but you're, you're, you're using them as examples of the opposite.

• 1:33:57Chris Williamson?

  Yes.

• 1:33:57Morgan Housel?

  Yeah, I agree. The Tim's post on 13 Reasons Not to Get Famous will make your jaw drop.

• 1:34:02Chris Williamson?

  It's a fucking masterpiece.

• 1:34:04Morgan Housel?

  It's great. And you read, there's nobody who will read that and, and disagree with what he's saying. Like, there is a massive downside to fame. I think once, I don't want to speak for him, but I think once he experienced it, he pushed back at, pushed back at it in a pretty successful way.

• 1:34:17Chris Williamson?

  Yeah. Yeah, it's very interesting. Um, but yeah, the paranoia leads to success because it keeps you on your toes thing kind of also comes back to what we were saying earlier that, um, the people who we most admire are the ones who have the least admirable internal states, right? If you were to trade places with the texture of Elon Musk or Kim Kardashian or Conor McGregor's mind, you would probably not foot the bill for the price that you'd have to pay. And again, hidden observable metrics. Again, this is why I love the, the fact that these threads all tie together, even though they're disparate ideas, there's a narrative that kind of weaves them all together. And fundamentally, it's our stupid desire for recognition and accolade

• 1:35:00Chris Williamson?

  and prestige and to be seen and validated by the world and to be slightly higher than the people that are around us. There's this idea, I meant to say earlier on, uh, intergenerational competition theory. Have you heard of this?

• 1:35:13Morgan Housel?

  No.

• 1:35:13Chris Williamson?

  So, um, it describes a situation where one of the biggest predictors of your quality of life, especially when you smear it across an entire nation, is how does this generation compare to its parents' generation at the stage of life that it's at? And, you know, we've heard it's been a bit of a meta meme for a while, you know, like millennials were the first generation to not do better than their parents, but really with Gen Z. I think that that is being felt very, very closely. And even if the raw facts and data when it comes to cost of living minus inflation plus wages and all of the rest of it, even if that kind of ends up not making too much of a difference, the way that it seems, I'm never

• 1:35:57Chris Williamson?

  going to be able to buy a house, people staying in the house, you know, the most common living arrangement for a man under 30 is still being at home with his parents.

• 1:36:04Morgan Housel?

  Right, right. And I think, I think social media plays such a massive role in this of just who you're comparing yourself to now is a curated algorithmic highlight reel of the fake scenes in other people's lives. And that becomes your baseline to compare yourself against to. And I see this in my own life of like, when I was growing up, my definition of rich was the people who bought new pickup trucks and a normal person drove a used pickup truck. And you compare that to the current generation that grew up with YouTube and Tik Tok and Instagram and whatnot. Their expectations are in a different universe compared to my generations and your and your generation. And like, what is that going to do to their well being, their psychological well being? You know, it's not going to be good. And the people who've studied this Jonathan

• 1:36:48Morgan Housel?

  Haidt of NYU of like teenage depression and suicide exploded when social media came out, particularly when it came out on mobile devices, not not went up a little bit, it went vertical during those periods. And I still feel like we're probably in the early eight, the early innings of that cycle.

• 1:37:04Chris Williamson?

  Yeah, I would agree.

• 1:37:06Morgan Housel?

  And so it's, it's, it's pretty scary, particularly as a parent of two young kids who are, you know, four and eight. What is, what is their generation going to be like when they're 17? After they've grown up influenced by social media in such a profound way?

• 1:37:19Chris Williamson?

  What we've been able to facilitate is industrial scale comparison.

• 1:37:26Morgan Housel?

  Yes.

• 1:37:27Chris Williamson?

  That's, that's fundamentally what social media.

• 1:37:29Morgan Housel?

  I think you, I think you, I think you could take it one step further and say industrial scale anxiety is what it produces. That's really what it was. It's designed to make you look at other people. Yeah. It's designed to make you look at other people and feel a little bit worse about yourself.

• 1:37:42Chris Williamson?

  I looked at this study from Finland this week. It was in my newsletter that.

• 1:37:49Chris Williamson?

  Worked out that 15%, around about 15% of the increase in young female mental health, adverse mental health outcomes can be attributed to use of hormonal birth control. And I'd said this when I first learned about the impact of hormonal birth control on developing brains, maybe about a year ago. I just sort of got it in the back of my mind and I meant to tell Jonathan about it. Because I don't know if anyone has like factored in the base rate of the increase in contraceptive pill use among young teenage girls. So there's a confluence of different things conspiring to try and

• 1:38:31Chris Williamson?

  damage the mental health of everybody. But yeah, man, it's, it's, it's not good. And, and you know, from a comparison perspective, think about it yourself. Think about how you feel. I call it post content clarity. Like after you've spent a good bit of time on your phone, like, you know, if you watch one type of thing, reading a blog, reading a collaborative fund blog or something, and I'm like, oh, like, you know, I've spent five minutes reading this, reading this thing. What, how do I feel after that? Do I want to ring my mom? Do I want to go outside? Do I feel like the world is actually working with me as opposed to against me? Have I got agency? Or after I watched some panel argument about politics or something, I want to just, you know, curl up in a ball and I want to eat shit food. And I don't want to tell anyone that I miss them. And, you know, that,

• 1:39:15Chris Williamson?

  that very much is the duality of, of the internet. And we always justify the toxic elements that we spend our time on by the needles in haystacks that we sometimes find. As my dad would say, a streak of piss in a pile of shit.

• 1:39:32Morgan Housel?

  Love it. This is true. Like, I definitely feel like modern politics is explicitly designed to piss you off. And once you realize that that's the game, it's like, it's not a game. Like, who would want to voluntarily play that game? Of which you are guaranteed to wake up every morning and read your news site of choice for it to explicitly just make you a little bit angry or at the other half of the country. And once you frame it like that, it's like, why would you voluntarily play that game? I'm going to choose to play a different game.

• 1:40:00Chris Williamson?

  Too much, too soon, too fast. A good idea on steroids quickly becomes a terrible idea.

• 1:40:06Morgan Housel?

  Yeah, there's this idea of blitz scaling in startups, which is like, and look, it came from very successful entrepreneurs. But it's this idea of like, however fast you're growing, like, do it faster. Like, like, whatever good idea you have, like, do it 10 times better, 10 times faster, like, go, go, go, go, go. And I think with blitz scaling usually comes blitz failing. Like, there, there, there's a natural rate at which anything in investing, or business, or life, or relationships should go. And if you try to push it past that, it's going to break. Particularly true for relationships. Like, like, there, there's a natural rate in which you should go from meeting someone to marrying them. I have no idea what that natural rate is. They're going to be different for everyone. But the extent that you're trying to push it further and faster than it's going to go, it's always going to lead to disappointment. So I think

• 1:40:48Morgan Housel?

  it's just understanding the natural rate at which these things need to grow, to grow at, and realizing that if you push them faster, it's all going to break. It's so important. It's really important in investing, where I said one time, the fastest way to get rich is to go slow. Because that's what always gets people, that's what always throws people off. It's like, they get this investing strategy, or they're, they're good at, they're, they're good at picking stocks, whatever it is. And then their natural intuition is like, great, now let's do it faster. I can earn 10% a year, like, how do we get to 20? I can earn 20, how do we get to 40? And that's, it's going to blow up 10 times out of 10. Like, the natural rate of how fast you should grow your wealth, for the huge majority of people, is probably between 5 and 10% per year. That's the natural rate. And if, and your ability, your willingness

• 1:41:32Morgan Housel?

  to push it beyond that, is, is, is eventually going to go over the cliff. And like, if you stay in that zone, and just keep it going for your lifetime, you win. You, you win the game. You're going to compound your wealth, everything's going to, everything's going to be great. And it's the people who try to push it beyond that, that are always going to end up as losers.

• 1:41:49Chris Williamson?

  It's like the don't hit the red button experiment. Like, there's just one thing that you don't do, and it's don't push it beyond that. And yet, the blow up risk is always a hidden metric. Whereas the additional 10% gain that you got last year is a very observable one. Who's, uh, who's Robert Wadlow?

• 1:42:08Morgan Housel?

  Robert Wildow was the tallest human to ever exist. He was, I forget the exact number, but I think he was pushing eight feet tall. He was just an absolute, if you look at pictures of him, it doesn't look like a human being. It looks like a cartoon. He was, he had a an abnormality in his pituitary gland that just bombarded his body with growth hormone for his entire life. And what I wrote about in the book is like, if you, if you think about Robert Wildow, he was eight feet tall. He wore, I think, a size 22 shoe. His hand was like 16 inches across. You think of him as like the real life version of Paul Bunyan. Like you would think he would be like a superhuman, just like the strongest man, the best athlete. And he wasn't. He would, he could barely walk. He could, he could

• 1:42:52Morgan Housel?

  only walk on crutches. And when he did it, it was like this horribly pained limp that he had. He was, he's super awkward walking around. Like his, his body just didn't really work. And the takeaway was like, you can't double the size of a human and expect double the output. If you double the size of the human, the entire thing breaks. And you look at this in nature, like most very large animals either have extremely long skinny legs, like a giraffe, or very short stubby legs, like a rhinoceros. But if you take a human that has like medium length legs, and you just say double the size of it, it doesn't work. And while though he was growing so, but he died, I think in his late twenties, he was very young. And, but the scientists and the doctors who were studying him said,

• 1:43:34Morgan Housel?

  if, if you grow much larger, simply walking, even with your cane, your legs are going to snap. Cause the, like the, the mechanics of the human body just did not support a leg and weight ratio of that amount. And what actually killed him is almost as tragic. Like, it was so hard for his heart to pump throughout his enormous body, that he had very, very high blood pressure. And that led to an ulcer, and the ulcer got infected, and he died from the infection. So it's actually such a tragic story. It's amazing. It's like he's always in the Guinness Book World Records and the like, the he was basically a circus freak during his day. But you read about this man, it's like it's a terrible, terrible tragic life, but it's a stark example of you can't just double the size of something and expect double the output.

• 1:44:19Morgan Housel?

  Sometimes when you double the size, the whole system collapses.

• 1:44:22Chris Williamson?

  Yeah, there's something about kind of a survival of the fittest as well, though. You've got this example about how trees grow sometimes and runts get eaten eventually. But then when you force growth too much, that's when it goes wrong. There is definitely something about, I guess, when the tide goes out, working out who's swimming naked, so to speak. I think that's a useful side effect of growth.

• 1:44:47Morgan Housel?

  Yeah. And the same thing with Robert Reddler, like perfectly applies to companies. You can't double the size of a company and expect just to get double the output. Because when you double the size of a company, particularly like a startup, goes from 20 employees to 100 employees or whatever, all of a sudden, your employee culture is different, your hiring practices are different, you need rules and regulations, you need employee handbook. And that might completely kill the culture that made the startup successful from zero to 20 employees. So knowing the normal growth rate and the natural size of any of these businesses is super important. Starbucks is another example I use in the book of like, back 15 years ago, it was on this ridiculous growth binge. And it was just like, every street corner in the world needs not just one Starbucks, but two. And it found that it completely oversaturated.

• 1:45:32Morgan Housel?

  And it completely killed the Starbucks experience. It went through this depths of despair a couple of years around 2007, where Starbucks was really losing its way. And it found that like, whatever the natural growth rate for Starbucks was, and whatever the right amount of stories it should have, it went way far beyond that and needed to pull way back. So all these examples of like, successful companies, good companies, that try to push it too hard, and it backfires on them, those stories are everywhere.

• 1:45:57Chris Williamson?

  What, are there any examples of how this is, this would apply to people's personal lives, or the way that they show up in their day to day existence?

• 1:46:06Morgan Housel?

  I think there's definitely a case, I use the example of Travis Kalanick, who was the founder of Uber, and he later got pushed out of the company. As someone who, he had the exact right personality and management philosophy to bring Uber from zero to 100. And he was the exact worst person that you can imagine to bring Uber from 100 to 1,000. And so there's a lot of times where your specific personality is going to work really well in this situation and be disastrous in another. And I think that can be true at different phases of your life. If you are someone who is the life of every party and you can drink people under the table and you're loud and you're boisterous, that is an amazing personality when you're 21.

• 1:46:49Morgan Housel?

  If you are still that person at 47, it's probably a disaster. That's not the personality you by and large want at 47. So sometimes what works in one area like doesn't scale to other areas of your own life. And if you don't realize that, you can't change course. It's a tough road for a lot of people.

• 1:47:07Chris Williamson?

  I love it. Morgan Housel, ladies and gentlemen. Morgan, you are one of my favorite writers. I'm so glad that we've been able to get you back on. You're coming on again in January.

• 1:47:18Morgan Housel?

  In January, and I'm scared to see the set design that you pick for me because now I know that is, it is a reflection. Is this going to be like some cute tea house that you bring me to? And I'm going to feel really bad about who you think I am.

• 1:47:30Chris Williamson?

  Perhaps, yeah, we'll have to wait and see. But no, dude, I absolutely adore this. When's the book actually out? When, when does it get released?

• 1:47:37Morgan Housel?

  November 7th.

• 1:47:38Chris Williamson?

  November 7th, right. This will be out pretty much around about then. Everybody needs to go and buy this book. Morgan Housel's first book, Psychology of Money was a Beast. And this next one is, is absolutely phenomenal. Where should they, people go, where else should they go to find out what you do and follow you?

• 1:47:54Morgan Housel?

  I spend most of my time on Twitter. My handle is first and last name Morgan Housel. I also have a young nasid experimental podcast called the Morgan Housel Podcast. I'm still playing around with it.

• 1:48:03Chris Williamson?

  Oh yeah. Morgan, I'll see you next year.

• 1:48:05Morgan Housel?

  Thanks, Chris.