Seek Simple And Obvious Ideas, Not Complex Ones
There are three simple things I do every morning to prime myself to have a great day. They are:
Stretch (10 minutes).
Meditate (10 minutes).
Write out what I’m grateful for, my intention for the day, and my one goal for the day (2 minutes).
The difference between knocking this out first thing and not doing it at all is profound (just ask my wife - she’s the one who has to deal with me when I don’t). If I’m having a bad day, there’s only one question I need to ask: did I prime? The answer is usually no.
This simple routine is robust. I can do it anywhere, at any time. All I need is a small space and a pen & paper. It takes only 22 minutes, and yet it profoundly impacts the next 16 hours.
It’s also obvious that this routine should improve my day. Stretching gets the blood flowing through the body, meditation calms the mind, and writing out a gratitude list and setting an intention and a goal focuses the mind on positivity and productivity.
Simple ideas are powerful.
I hang my life on a handful of ideas that can I can explain in just a few sentences:
Inversion: To help you achieve a specific outcome, avoid everything that definitely won’t get you that outcome.
Reciprocation: You get back what you put out into the world.
Back-Up System: If the worst happens, have a “rabbit out of the hat” solution to save the day.
Incentives: You get the behavior you reward for.
Slow, incremental constant progress: You can build anything with a little progress every day.
Barbell Strategy: A lot of risk on one end, extreme safety on the other.
Asymmetric Opportunities: Seek opportunities where the upside is much greater than the downside.
Gratitude: Being grateful for what you already have is a key to happiness.
Meditation: You are not your thoughts.
Exercise: A healthy body is a healthy mind.
Do these heuristics always work? Of course not, but they work most of the time in most situations.
Nassim Nicholas Taleb writes in his book, Antifragile: Things That Gain from Disorder, about this “Less is more” idea. Simple ideas are not perfect, but they are not meant to be. They are “fast and frugal,” designed to “make good decisions despite limited time, knowledge, and computing power.”
Location, Location, Location.
Take real estate as an example. If there is one thing to know about real estate, it’s that location is everything.
I don’t own a home, and all my assets are liquid. But, based on this heuristic, I would look for a house that’s close to great schools, close to public transit, in a safe neighborhood, and a growing metropolitan (Toronto, Los Angeles, etc.). With no additional research, I’d probably do okay.
Taleb reminds us that these heuristics are “not quite and not always true, but it shows the central thing to worry about, as the rest takes care of itself.”
You only need one reason to do something.
Taleb has a model I like about decisions making. He tells us that if he has more than one reason to do something, he doesn’t do it. Taleb writes:
If you have more than one reason to do something… just don’t do it. It does not mean that one reason is better than two, just that by invoking more than one reason you are trying to convince yourself to do something. Obvious decisions (robust to error) require no more than a single reason.
Many people attempt to talk themselves into decisions that are not obvious. They create “pros” and “cons” lists for the decision and try to weigh them against each other.
Obvious decisions only need one reason. That’s why they are obvious! Make obvious decisions and avoid complicated ones.
Jump over 1-foot bars.
Warren Buffett and Charlie Munger have built their lustrous careers on obvious decisions. In Buffett’s 1989 letter to Berkshire Hathaway shareholders, Buffett writes:
Easy does it. After 25 years… Charlie and I have not learned how to solve difficult business problems. What we have learned is to avoid them…We concentrated on identifying one-foot hurdles that we could step over… in both business and investments, it is usually far more profitable to simply stick with the easy and obvious than it is to resolve the difficult.
Buffett and Munger stick to the easy and obvious. Great decisions aren’t complicated. Wait for the no brainer and knock it out of the park.
Invest in what “Nerds Do On the Weekend.”
Legendary entrepreneur Marc Andreessen uses a simple model for his investments. He tells Tim Ferriss, in Tools of Titans, that one of his heuristics is to ask: “what do nerds do on the weekend?” and then looks for investments in those areas. Andreessen says:
We call our test ‘What do the nerds do on nights and weekends?’ Their day job is Oracle, Salesforce.com, Adobe or Apple or Intel or one of these companies, or an insurance company, bank [or they’re a student]. Whatever. That’s fine…The question is: What’s the hobby? What’s the thing at night or on the weekend? Then things get really interesting.
This obviously won’t work every-time, but it’s a great rule of thumb when looking for possible investments.
Don’t Do better— Do New.
Al Ries & Jack Trout give us a simple rule of thumb when marketing a product: don’t try to be “better” than your competitors. Instead, invent an entirely new category to compete in. In their book, The 22 Immutable Laws of Marketing, (reprinted in Tools of Titans) they write:
When you launch a new product, the first question to ask yourself is not “How is this new product better than the competition?” but “First what?” In other words, what category is this new product first in? Everyone talks about why their brand is better. But prospects have an open mind when it comes to categories. Everyone is interested in what’s new. Few people are interested in what’s better.
With Wealest, I tried to create a new category other than a traditional “finance” blog. I’m not in finance. I don’t talk about the stock market or about investing. Instead, I explore the “first principles” of wealth creation that others have used to build wealth. I don’t see that anywhere else. New is better than “better.”
Cliches are cliches for a reason.
Certain cliches are still around because they are generally right. Things like:
Do what you love.
Be kind, for everyone you meet is fighting a battle you know nothing about.
Opposites attract.
Good things take time.
This, too, shall pass.
You are what you do, not what you say you do.
Quality over quantity.
What goes around, comes around.
Every cloud has a silver lining.
When life gives you lemons, make lemonade.
Drink 8 glasses of water a day to keep hydrated.
Aim for 7-8 hours of sleep each night.
Avoid sugary, processed foods.
People think that because these are simple ideas, they can’t possibly be true or helpful. All of this is excellent advice. If you followed it, your life would absolutely improve.
So, stop looking for complexity and start searching for simplicity instead. There is power in simple, obvious ideas. Those are usually your home runs.
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Ferriss, Timothy. Tools of Titans: The Tactics, Routines, and Habits of Billionaires, Icons, and World-Class Performers. HMH Books. Kindle Edition.
Taleb, Nassim Nicholas. Antifragile: Things That Gain From Disorder (Incerto). Random House Publishing Group. Kindle Edition.
Warren Buffett’s 1989 letter to Berkshire Hathaway shareholders: https://www.berkshirehathaway.com/letters/1989.html