Key Takeaways
- Complexity emerges from a set of simple rules. In the real world, you get paid for making good judgments from the basic principles, that’s why understanding is key.
- To be wealthy you can’t depend on being paid based on time, but by using leverage. Productizing yourself and having equity are ways of achieving it.
- Self-awareness and meditation are central to a calm, effective mind.
- Cryptocurrencies are one of the greatest inventions in human history, everyone should at least try to learn about it.
- A good life depends on the types of “games” we choose to play. Prefer the long-term over the short-term.
You can check all the episode information here
Notes
Science and Fundamental Principles
- Science is the moving force of society.
- 15:30 Experimentation, Verifiability, Falsifiability are the hallmarks of science.
- Richard Feynman had an inspirational impact on Naval.
- [17:30] Feynam Quote: “I learned very early the difference between knowing the name of something and knowing something”
- Understanding is key: knowing something should mean having the power to explain in 10 different ways.
- In the real world, you get paid for making good judgments from the basics.
- N (Naval): Having a good basis of arithmetic, statistics, probability, and understand some basic math is all you need. You don’t need calculus, trigonometry, game theory unless you proceed into some really technical field. Nonetheless, kids spend a lot of time learning these.
- T (Tim): Nowadays, using some days to understand the basics of, for example, accounting using YouTube and a few books, can actually allow you to make much better decisions and get you way ahead.
- Feynman has a parallel to Solomonoff’s Induction (a formalization of Occam’s razor) in a completely different field:
- Solomonoff’s Induction: It is a mathematically formalized combination of Occam’s razor and the Principle of Multiple Explanations. All computable theories which perfectly describe previous observations are used to calculate the probability of the next observation, with more weight put on the shorter computable theories.
- Feynman established a parallel with moving photons moving through space-time.
- N: 2 different fields, 2 different characters, 2 different things but with underlying fundamental theory. Complexity emerges from a set of simple rules.
Generating Wealth
- 26:20 Naval’s Tweet Storm: How to get Rich
- N: The purpose of money is freedom: Doing it ethically, sustainably, doing something that you enjoy – Absolutely possible, himself being an example of it.
- “You’re not going to get rich renting out your time. You must own equity – a piece of a business – to gain your financial freedom.”
- The person who is the best in the world at doing something is going to get to do it for the entire world: through a combination of leverage, distribution, accountability, and specific knowledge.
- Productize yourself into a business.
- To get wealthy you need to own a part of a business.
- A lot of these principles are written for young people because it’s a lot easier to set yourself on a path that leads where you want to arrive.
- A lot of people already have invested parts of their lives to paths that do not lead to the desired outcome.
- We are pain avoiding creatures that try to ignore being aware of mistakes that cost us a lot more when not addressed timely (health, marriage, career. etc.)
- We don’t want to put in the work in new skills that would allow us to achieve.
- “Everyone wants to stay on the path they’re on, make a few tweaks, and get to the top. (…) These are the hard parts. It’s not the learning, it’s the unlearning. You have to be willing to start from scratch.”
- Naval’s principles to achieve consistent “paydays”
- Ability to understand deeply complex concepts, communicate them to the rest of the world, being an interface with designers, programmers, and the capital markets and consumers, all while identifying trends and acquiring equity.
- Investing early on
- Public markets
- Cryptocurrencies
- Starting Funds
- Naval put himself in a position he knows he is going to make money over time. By being surrounded by a network of capable, trustworthy, ethical, loyal people he knows he can do business with over the long run.
- Optimized his life for independence and freedom.
- “I’m lazy (..) I don’t work a lot of days”.
- “I want flow”
- “Make money with your mind, not your time”, using the age of infinite leverage.
- [41:00] “Money doesn’t make you happy, it takes care of your money problems. In fact, there’s nothing out there that will make you happy forever. You have to take responsibility for your mental state.”
- Naval worked through evolving his mental space.
- “Since I’ve become calmer, my effectiveness has gone through the roof.”
- “Pretty much everyone is anxious all the time”
- The sweet spot is when you’re able to separate your motivation from anxiety.
The experience of Anxiety
- Going from ‘Whirlpool’ experience of anxiety to ‘calm Naval’:
- Philosophy
- Yoga
- Meditation
- Accumulated wisdom from getting older
- Most important: meditation as two main practices
- Consistent self-examination during the day
- Sitting with your thoughts (the traditional aspect of meditation)
- Anxiety comes from unexamined thoughts
- spend time with yourself, it’s your most important relationship, that’s the world you have, the lens you see through
- “proper meditation, proper examination should ruin the life that you’re currently living. It should cause you to leave relationships. It should cause you to reestablish boundaries with family members and with colleagues. It should cause you to quit your job. It should cause you to change your eating patterns … If it doesn’t do that, it’s not real examination. If it doesn’t come attached with destruction of your current life, then you can’t create the new life in which you will not have the anxiety.“
- 3 self examination practices:
- Reading philosophy: at night, usually rereading as inspiration
- Western philosophy: Arthur Schopenhauer
- Eastern philosophy: Osho, Jiddu Krishnamurti, Kapil Gupta, Anthony De Mello
- Awareness of unbidden thoughts during the day
- Meditating
- 60 minutes, for at least 60 days, 1st thing in the morning
- “let it happen”
- “you clear your mental inbox’ [56:00]
- “the most important time that I have”
Cryptocurrency
- 01:02:00: T: Storage of value in crazy times like 2020
- N: “cryptocurrencies are one of the greatest inventions in human history”
- Suggested listening: The Quiet Master of Cryptocurrency — Nick Szabo (#244)
- Risks associated with stable coins like Tether and Maker Dai
- fraud risk: you have to trust that for each coin, there’s a USD backing it
- censorship risk: the government could cease the dollar backing up the coin
- blow up risk: collateral cryptos
- Naval’s recommendations on crypto
- Read and inform yourself
- Dig into “High-level stuff”
- Decide how much exposure are you willing to take
- Buy it using services like Coinbase
- Put it somewhere safe, probably in the cloud (with Coinbase)
- As long as there is someone in the world that believes in the value of it, cryptocurrencies have redeemable value. The trend is that more and more people believe in it.
- Generalized validation is key. That is only supported by a strong story that is back up by individuals and institutions.
Life wisdom
- “All Self-Help Boils Down to “Choose Long-Term over Short-Term.” | Naval, Twitter
- Do fun stuff for you that looks like work for others, and that can sustain you over the long term.
- Find people that don’t take work to be around
- Self-aware people are attractive.
- “The Modern Devil Is Cheap Dopamine.” | Naval, Twitter
- “The Reason to Win the Game Is So That You Can Be Free of It.” | Naval, Twitter
- All of life is games
- not wanting something is as good as wanting – “there is so many things here that I do not want”
- ‘ that is freedom, that is power ‘
- 2 ways to achieve this state
- Choose your games very carefully
- Play the game and win it
- “It’s hard to be calm until you lost a lot and won a lot”
- Activities that are nondual in nature
- mediation & yoga
- reading for fun
- writing & journaling
- building as a business as long you are doing it for the craft itself