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A Good Day On NotePD

Thought provoking ideas, my thoughts.

    1. Ignore Black Swans

    via @roccodesta. Generally, this term is wildly misunderstood and misused. How many articles do you see that identify 10 potential black swans? It's ridiculous. I don't think Rocco is misusing the term BTW. A black swan is not something bad that might happen it is something not reasonably predicted by many people. Even the pandemic might not fall into that category (not that I saw it coming).

    I disagree with ignoring them however. Rocco says trying to plan for one is likely to result in wasted time preparing for an outcome that never comes. I agree but as opposed to preparing for a black swan, I do believe in preparing for the consequences that might be easier to see coming. Examples from my recent past; before the pandemic was formally declared we got a few weeks ahead on food just to avoid hassle not because we saw supply chain problems (maybe the supply chain problems were a black swan?).

    From my day job, many investors have been caught off guard by the jump in interest rates and what it has done to bond funds. I've been worried about this for years and years. If interest rates are at all time lows, then prices are high and buying at high prices is clearly risky, not a black swan in my opinion although maybe bond fund holders were the turkeys if you know that reference. I've pretty much been avoiding the parts of the bond market most vulnerable to rising rates for 15 years. The trade of owning long term bonds worked of course until this year but investors were taking huge risks and this year are facing the consequences of those risks. I just avoided the hassle of this sort of thing that was bound to happen at some point and I knew I would not be able to time when rates would start to go up.

    Now something forward looking. Two years ago we went solar. We're not off grid but can be when the power goes out. Our grid infrastructure is very antiquated and it going out and staying out for a while is very plausible, it has happened before. From there, who knows what sort of black swan could arise but having our own power avoids a tremendous amount of hassle if it ever happens.


    2. Stigmergy

    Hat tip to @younes for the new word which means "you do something now to make it easier for your future self." I commented that I've built my entire life on this premise, I had no idea there was a fancy word for it. If you live below your means you're giving your future self more optionality for all sorts of things including quitting a job you hate. When you stay in shape with a proper diet and effective exercise you're giving your future self an extended health span, you'll be able to do the things you enjoy to an older age. One of the things I love to do is fight wildland fires. I am well past the age of being able to do that without plenty of vigorous exercise.

    I've said in many different places that your 40's and 50's (guessing I will say the same thing about 60's when I get there) can be a great time of life when you have a little money in the bank and can still get things done.

    Another example of stigmergy is learning new things that could lead to opportunity later if you need it or want it.


    3. Ethereum merge

    @JamesAltucher wrote up a little primer on this. I don't have value to add to his list but bigger picture, the extent to which I see Bitcoin zealots on Twitter trying to crap on ethereum is always curious. If ethereum is a shit coin like they say, then why spend time crapping on it, it makes no sense? What does that imply about Bitcoin? I own a little of both for the asymmetric potential but nowhere close to drinking any Kool-Aid, I am a skeptical HODLer.


    4. Tune Out

    A list by @sheeraz of things he tunes out. I'll pivot on that one to things I opt out of which is pretty much every mainstream, popular thing. I don't play video games, I don't eat the standard American diet as recommended by the healthcare industry/medical profession, target date funds are terrible tools, I've never watched shows like The Voice or The Masked Singer, I haven't had a commute since 2003, I did not get vaccinated for Covid, I've never lived some place that had an HOA, we don't buy new cars every few years, I could go on and on but I want to avoid what most people are doing.


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