📖The almanack of Naval Ravikant
- authors
- Eric Jorgenson
- year
- 2020
- url
- https://www.navalmanack.com/almanack-of-naval-ravikant/
Background
schools can act as “intelligence lottery” that can bring you up a class
Stuyvesant is one of those intelligence lottery situations where you can break in with instant validation. You go from being blue collar to white collar in one move. [73]
Part I. Wealth
Building wealth
Understanding how wealth is created
thinking of “making money” as a skill you develop
I like to think that if I lost all my money and you dropped me on a random street in any English-speaking country, within five or ten years I’d be wealthy again because it’s just a skillset I’ve developed that anyone can develop. [78]
It’s not about working hard, it’s working smart—you have to know what to do, who to do it with, and when to do it.
Hard work is still important but it has to be directed in the right way
If you don’t know, what you should work on, you should figure this out first. You should not grind until you figure out what you should be doing.
wealth, money, status.
wealth: having assets that earn while you sleep
↑ pursue this
money: how we transfer time and wealth
status: place in social hierarchy
If you (secretly) despise wealth, it will elude you. Understand that ethical wealth creating is possible.
“You will get rich by giving society what it wants but does not yet know how to get. At scale.”
“Pick an industry where you can play long-term games with long-term people.”
specific knowledge: something that is hard to learn. it’ll look like a game for you, but a hard work for others
Leverage
Labor leverage (people working for you) will impress your parents, but don’t waste your life chasing it.
Capital and labor are permissioned leverage—someone has to give them to you.
Code and media are permissionless leverage.
You can create software/media what works while you sleep. If you can’t code, write books and blogs, record videos and podcasts.
there is no skill called “business.” avoid business magazines and business classes. — study microeconomics, game theory, psychology, persuasion, ethics, mathematics, and computers
reading is faster than listening. doing is faster than watching
“Set and enforce an aspirational personal hourly rate. If fixing a problem will save less than your hourly rate, ignore it. If outsourcing a task will cost less than your hourly rate, outsource it.”
“Become the best in the world at what you do. Keep redefining what you do until this is true.”
“Apply specific knowledge, with leverage, and eventually you will get what you deserve.”
this is hard and will take decades, but most of that decade is not execution but rather figuring out what you can uniquely provide
“technology” is the set of things that don’t quite work yet (Danny Hillis?). Once something works, it’s no longer technology.
Become the best in the world at what you do. Keep redefining what you do until this is true.
Find and build specific knowledge
specific knowledge is not learned in a classroom
specific knowledge cannot be taught, but it can be learned
“→ An obsessive personality: you dive into things and remember them quickly”
(this is something I have)
“No one can compete with you on being you. Most of life is a search for who and what needs you the most.”
“Specific knowledge is found much more by pursuing your innate talents, your genuine curiosity, and your passion. It’s not by going to school for whatever is the hottest job; it’s not by going into whatever field investors say is the hottest.”
When you’re competing with people, it’s because you’re copying them. Stop copying and be yourself
Play long-term games with long-term people
compound interest applies in areas other than capital
business relationships
reputation
in individual relationships as well
99% of what you do is wasted time (in the goal sense)
it’s not wasted in the absolute sense because you’re finding the 1% that you can go all-in and earn compound interest
when you find the 1% that is not going to be wasted, go all-in and forget about the rest
Take on accountability
Accountability is a double-edged sword that allows you to take credit but also bear responsibility for failures
Build or buy equity in a business
q
If you don’t own a piece of a business, you don’t have a path towards financial freedom.
unless you own part of a business, you don’t have a passive income
you income is tied to the hours you put it. if you don’t put hours—you don’t earn
Usually, the real wealth is created by starting your own companies or even by investing.
Find a position of leverage
“If it entertains you now but will bore you someday, it’s a distraction. Keep looking.”
“I only really want to do things for their own sake. That is one definition of art.”
The less you want something, the less you’re obsessing with it, the more you work in a natural way. You’ll do that for yourself.
when you do things for their own sake, the people around you will see the quality of your work
“Follow your intellectual curiosity more than whatever is “hot” right now. If your curiosity ever leads you to a place where society eventually wants to go, you’ll get paid extremely well.”
products with no marginal cost of replication (books, media, movies, code) as a new form of leverage
“Whenever you can in life, optimize for independence rather than pay.”
Get paid for your judgment
even small differences in performance are magnified when steering a lot of capital, so even a 1% better thinker can earn 10×, 100× more
Prioritize and focus
set a high aspirational hourly rate and stick to it
being anti-wealth will prevent you from becoming wealthy
anti-wealth people are often playing status games—“I don’t need money”
wealth creation is a positive-sum game. status game is zero-sum game
three big decisions
where you live
who you’re with
what you do
Find work that feels like play
“I would rather be a failed entrepreneur than someone who never tried. Because even a failed entrepreneur has the skill set to make it on their own.”
The life is just games. When you see through the games, you stop caring that much about the result.
“I want to be off the hedonic treadmill.”
“Retirement is when you stop sacrificing today for an imaginary tomorrow. When today is complete, in and of itself, you’re retired.”
How to get lucky
types of luck
blind luck—completely out of control
luck through persistence, hard work, hustle, and motion
be good at spotting luck
build a unique character, a unique brand, a unique mindset, which causes luck to find you
networking is a complete waste of time
be a maker, show your craft, practice your craft, and the right people will eventually find you
Be patient
great people eventually have great outcomes (almost without exception)
“It takes time—even once have all of these pieces in place, there is an indeterminate amount of time you have to put in. If you’re counting, you’ll run out of patience before success actually arrives.”
“You have to enjoy it and keep doing it, keep doing it, and keep doing it. Don’t keep track, and don’t keep count because if you do, you will run out of time.”
Building judgment
Wisdom is knowing the long-term consequences of your actions
Wisdom applied to external problems is judgment
picking the direction you’re moving is far more important that how much force you apply
Just pick the right direction to start walking in, and start walking.
How to think clearly
_
“Clear thinker” is a better compliment than “smart.”
“Suffering” is the moment you see reality.
The more desire you have to make something work a specific way, the less truth you see
you need empty space to think.
I also encourage taking at least one day a week (preferably two, […]) where you just have time to think.
“It’s only after you’re bored you have the great ideas.”
Shed your identity to see reality
q
Tension is who you think you should be. Relaxation is who you are. —Buddhist saying
Learn the skills of decision-making
“The classical virtues are all decision-making heuristics to make one optimize for the long term rather than for the short term.”
Collect mental models
mental models as a compact ways to recall your own knowledge
(or rather quotes?)
principal-agent problem
the more you time someone’s compensation to the exact value they’re creating, the more you turn them into a principal, and the less you turn them into an agent
if you can’t decide, the answer is no
in modern society, there are tons of options
if you find yourself creating a spreadsheet with pros and cons, goods and bads… forget it. If you cannot decide, the answer is no
when you have two equal options, choose the one with more short-term pain. that likely means it has more long-term gain
our brain is wired to minimize short-term pain
the most efficient way to build new mental models—reading a lot
Reading science, math, and philosophy one hour per day will likely put you at the upper echelon of human success within seven years.
Learn to love to read
q
I think there’s a tendency among parents and teachers to say, “Oh, you should read this, but don’t read that.” I read a lot which (by today’s standards) would be considered mental junk food.
q
Reading a book isn’t a race—the better the book, the more slowly it should be absorbed.
it almost doesn’t matter what you read. eventually, you’ll read enough different things that it will dramatically improve your life
“Pointing out obvious exceptions implies either the target isn’t smart or you aren’t.”
the number of books completed is a vanity metric. as you know more, you leave more books unfinished → The number of books completed is a vanity metric
treat books as throwaway blog posts—there is no obligation to finish any book → Treat books as throwaway blog posts
Part II. Happiness
Learning Happiness
Happiness is learned
q
Don’t take yourself so seriously. You’re just a monkey with a plan.
what happiness means is unique to every human
“Happiness is there when you remove the sense of something missing in your life.”
when nothing is missing, you brain shuts down and stops running into the past and future to regret something or plan something
duality: every happy thought contains a seed of unhappiness
q
There are no external forces affecting you emotions—as much as it may feel that way.
“However, if you view yourself as a bacteria or an amoeba—or if you view all of your works as writing on water or building castles in the sand, then you have no expectation for how life should “actually” be. Life is just the way it is.”
Happiness requires presence
There’s a great definition I read: “Enlightenment is the space between your thoughts.” It means enlightenment isn’t something you achieve after thirty years sitting on a mountaintop. It’s something you can achieve moment to moment, and you can be enlightened to a certain percent every single day.
Every desire is a chosen unhappiness
“Desire is a contract you make with yourself to be unhappy until you get what you want.”
Saving yourself
Choosing to build yourself
Impatience with actions, patience with results.
Choosing to grow yourself
“Use your judgment to figure out what kinds of environments you can thrive in, and then create an environment around you so you’re statistically likely to succeed.”
Choosing to free yourself
The hardest thing is not doing what you want—it’s knowing what you want.
A taste of freedom can make you unemployable.