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Month: November 2011

Quotes November 2011

Quotes November 2011

“The best argument ever made for money is that people feel compelled to say it can’t buy everything.” – Aaron Haspel

“The best emails are a surprise.” – Carlos Miceli

“Time at large firms should be seen as subsidized learning. Learn lots, but get out.” – J.D. Long

“Things would improve fast if we would stop seeing jobs as rights, and start seeing them as contribution opportunities.” – Carlos Miceli

“A university is just a group of buildings gathered around a library.” – Shelby Foote

“Maintain a firm grasp of the obvious at all times.” – Jeff Bezos

“Between the ages of 20 and 40, the surest sign that a man has a taste of his own is that he is unsure of it.” – W. H. Auden

“If you think that giving away value doesn’t work, then turn on your radio.” – Joe Calloway

“Anything that does not kill you makes you very weak” – Norm MacDonald

“The skill of writing is to create a context in which other people can think.” – Edwin Schlossberg

“It is foolish for a forty-year-old to ask Hippocrates for health, and even more foolish to ask Seneca for wisdom.” – Baltasar Gracian

“Investors should always keep in mind that the most important metric is not the returns achieved but the returns weighed against the risks incurred. Ultimately, nothing should be more important to investors than the ability to sleep soundly at night.” – Seth Klarman

“By definition, experts represent the status quo.” – Chris Yeh

“Being a success-minded professional is like being a lady: if you have to tell people you are, then you aren’t.” – Margaret Thatcher

“Doubt is not a pleasant condition, but certainty is absurd.” – Voltaire

On Autocatalysis

On Autocatalysis

Compounding, simply put, means generating earnings from previous earnings. It’s a common term in finance. This is how saving money and being patient makes you rich. You put money in the bank, which makes you more money, which you put in the bank again, and that makes you even more money. It’s a slow but steady approach that usually yields great results for those who can wait.[1]

This process has a name that goes beyond finance jargon: Autocatalysis.

Autocatalysis means that the process’ output produces the necessary input for a similar reaction. Anything with an element of autocatalysis will grow exponentially, and faster.

The important thing to learn then is how to apply autocatalysis to our lives. Some things can have compounding effects, such as savings, but some things can’t. Staying awake won’t compound, you need a consistent amount of sleep. Here are three other areas of life that have compounding effects, when done right:

Productivity

The problem with most people’s productivity is their lack of systems in their daily lives. They trust their memory. They trust their willpower. They trust their energy. All recipes for disaster. We forget things, our willpower is limited, and our energy gets depleted. This is normal human behavior. The solution is not to power through our human flaws, but to structure our lives in a way that we avoid them completely.

When you apply the right systems[2] in your daily life, things get done with less effort, faster, and better. You accomplish more. And when you accomplish things, you have more time to accomplish even more. This is the number one “secret” behind winners: systems.

Networking

There is no mystery behind the growth of social networks like Facebook or Twitter. The more people they reach, the more people those people will invite. That process happens over and over again, and before you know it, the network is huge. You start with one member, but because of the inherent autocatalysis of networking, things can grow damn fast.

However, networking doesn’t create value by itself. It’s only a platform. While it may feel satisfying to meet for lunch, or have a Skype call, the returns are limited.

The lesson here is to take networking in our lives seriously early. Build many relationships fast, and then get to work. Once you start doing something noteworthy, the compounding effect of your network will take it from there and get your name across even more networks.

Flexibility

If I’d have to put the three areas mentioned above (personal finance, productivity and networking) in one group, it would be flexibility. Having more money, getting more stuff done, and knowing more people that can help you, are all elements that increase your options of where to spend your resources.

Once again, the key of having options is that it compounds. Having options means you’re valuable. It means more people demanding your knowledge or expertise. It means you’re scarce (or people would just go another way). The more impressive people I know spend a lot of time declining offers and ideas. Having options is the real wealth of the successful.

Bottom Line: Implement autocatalysis in personal finance, systems and networking early in life, and your options will increase exponentially.

Notes:

[1] For anyone interested in learning more about how to use compounding with their personal finance, I recommend I Will Teach You To Be Rich, by Ramit Sethi.

[2] If you want to learn more about systems theory (a topic much more philosophical than it gets credit for), I recommend Thinking in Systems, by Donella Meadows.

Top 10 Lessons From My Year Abroad In Australia

Top 10 Lessons From My Year Abroad In Australia

Around six months ago, I came back home after living for a year in Perth, Australia. I went there to give first-world higher education a chance, and to step outside of my comfort zone. Life in Buenos Aires was easy at the time, almost boring, and university education had been a disappointment, so it was time to change things in a big way.

You can read the original post on my reasons to move to Perth here.

I thought of writing this post when I got back, but I quickly realized that I didn’t have much to say. I replied to most of the questions about my trip with short “it was good” type of answers. I didn’t feel like sharing, because I didn’t feel like the learning experience from the trip was over yet. Things would hit me later, once I saw life again with my new Aussie glasses.

Now that the new site is up, it was time to write this post. Here are what feels like the top 10 lessons from my year abroad:

1- Racism is contextual

One of the reasons I chose Perth, was that I knew many students from all over the world would be there. I was dying to see the interactions between people from all sorts of different backgrounds, with all sorts of different physical traits. And what I experienced was beautiful thing: it didn’t matter. There was no visible racism going on.

Sidenote: Of course, one could argue that people still have racist thoughts, but I couldn’t care less about thoughts. It’s actions what matters, and I saw almost none.

Because of Perth’s multicultural and lack of a dominant group (maybe white Australians, but all the other groups combined would give them a run for their money), there is no dominant insider/outsider mentality. This means that almost every race that would be discriminated in other places, goes unnoticed here. The one group that I felt was clearly segregated, was Australian aborigines. However, this group of people would fit fine in many Latin American countries, while maybe muslims would stand out more.

Another interesting thing that happened to me in particular, was that because of my Argentinian background, most people didn’t have any preconceived ideas about me, with the exception of soccer-loving internationals. Again, while I would have been labeled “mexican”, or “drug-dealer”, or “arrogant” in other countries, I was label-free in a place that had no strong previous connections with my ethnic group. Australia and Argentina are, simply put, too far to have prejudices towards each other.

My time in Australia only cemented what I’ve been preaching for a while: all sorts of “isms” are blown out of proportion by the media, while the real world rarely acts on them. The rules of who we discriminate has nothing to do with race, gender, religion, etc. It’s purely context-based, which is to say, it changes so much that it’s too imprecise to mean anything.

When looking for social fairness, it helps more to look at the context each group is in, instead of fixing on the fixed.

2- Independence and courage are contextual too

Many people told me that what I did was brave, moving to the other side of the world, being so far from everything I knew. I disagree. Only making the decision was brave. Once you’re there, you will step up to the circumstances. As opposed to life-or-death situations, most of the “adventures” that we set out to do nowadays, are pretty safe.

My favourite trip was backpacking through Vietnam alone. I got many cuts and bruises, got lost in islands and cities, couldn’t communicate with locals, got sick, cold and hungry, and went through some other shitty situations. But at no point it was courage or independence what got me through. It was just context. It was the obvious thing to do. It was what anyone would have done in my place.

The world nowadays is safe enough to put ourselves in weird situations. At some point, threat lockdown will go down, and you will start making progress. The only moment where you need some courage is to cut the tie with your previous context, to force yourself to be in a tough spot. It’s all easier from there.

3- People are inherently good

This may be obvious for some people, and a cliché for others, but it was still a wonderful thing to experience firsthand in so many different settings.

On January 2nd, 2011, I spent a night in a hut in Sapa, Vietnam, with people from all over the world, chatting and playing games, away from civilization and it’s still one of the most humbling and human moments of my life. It’s a moment I go back to time and time again to remind myself how nice we can be to each other, when we focus on communication instead of imposition.

Not a lot to say on this lesson, other than pointing that this is why traveling is so important: it brings down barriers, it lets us see our similarities instead of our differences. Cliché? Sure. Important? Definitely.

4- Standard of living is not all that matters

Under any famous world ranking of best places to live, Perth is in the Top 20. From my experience, this makes sense: Perth has great weather (to this day, the best skies I’ve seen in any city), great infrastructure, reliable services, etc. It’s safe, easy (although very expensive) and clean. It only took me a week to realise that Perth (and Australia in general) lives up to its standard-of-living hype.

However, I realized about the same time that I had to leave soon. Australia offers a comfortable life, but with serious trade-offs: too much control and regulation, a focus on leisure, and not much to do for the socially and professionally curious. Sure, there are outliers, and I got a chance to meet many of them, but like in Argentina, they are too few to make a serious cultural impact yet. So, while Australia and Perth are great places to live, they may not be great places to grow.

The ultimate lesson for me was that comfort is very costly at this age. When you’re in your 20’s, you can take more risks, put yourself in tougher situations, and struggle more, because you are strong and free enough to withstand it. However, choose comfort early in your life, and you may pay the price with early stagnation.

5- There’s healthy balance between rules and chaos, and I don’t know where it is

Like I said in the previous point, Australia is famous for its regulations and order. Signs telling you what you can’t do are everywhere. At first, I thought this was a good thing, until I started digging deeper into the locals’ opinions, which wasn’t that positive. Many Australians told me that they get tired by all the constraints in the system.

For example, lack of transportation and things to do after early hours of the night is a major cause of boredom among the younger groups. This may not seem like a big deal for people living in big cities with a wide range of interests to explore, but Australia prides itself of its gastronomy and night-life. It’s a bit contradictory for many to have their primary source of enjoyment so regulated. With so much focus on having fun, people sure get bored a lot.

Consider the somewhat opposite case of Buenos Aires. Contrary to most big Australian cities, the capital of Argentina is chaotic. Sure, there are rules, but the culture accepts and encourages to avoid them if you think it’s worth it. This may seem like a terrible thing, but there’s still a positive cultural effect: people are more relaxed, there’s a constant feeling of defiance which adds excitement to any activity, and the lack of rules keeps the mind open.

Now, I don’t have to clarify the negative aspects of Buenos Aires’ lack of regulated culture: more crime, more stress, more friction, etc. However, the key takeaway is to understand that no extreme is a good thing. There must be a healthy balance somewhere in the world, although I don’t know where it is yet (though I mean to find out!). There must be a place that enforces enough rules to maintain and organised and respectful society, but that also gives enough freedom to its citizens to explore and challenge the system.

6- The world is a very small place

There’s not much farther you can go from Buenos Aires than Perth, before you start coming back. Traveling, and more importantly, learning how everyday life is in the other side of the world, really puts distance in perspective.

When you’re a kid, you look at a map, and you see the “near” countries, and the “far” countries, but these distinctions stop making sense when you actually go there. Any flight to another country oscillates between an hour and 20-something hours. Wherever you go, that’s nothing! You get on the plane, watch a movie, sleep for a while, read a book, do some work and you’re there.

The lesson, of course, is not a technological one. I’m not revealing anything that we don’t know by saying that we can go anywhere super-fast now. The lesson is that when you do see how close people from all sorts of different backgrounds really are, you connect stronger with them. It may sound simple, but going from seeing people that dress differently and eat other foods on TV and books, to sharing a meal and a conversation in person in a matter of hours, strengthens your human bond with them. And once you do that as far as possible from home, it feels like all your fellow humans are right around the corner.

7- The less you know, the more you learn

I sort of have a problem with people choosing Europe as their default travel destination. Most of my friends from the Western world seem to prefer to go there before even considering other equally affordable places. Never mind that the natural wonders that Latin America, Asia and Africa have to offer will blow your mind. It’s not about competition. It is, however, about aiming for the unknown.

We’ve all seen the photos of a friend or family member on the Eiffel Tower, or the Big Ben. Everyone knows what to expect (which doesn’t make it any less beautiful). Not only that, most people that go to Europe for tourism, already know what they’re going to see before they go there. Their itineraries are very well structured.

On the other hand, when you go to distant places that you don’t know much about, there’s no clear expectations. You remain humble, you keep your eyes open because you don’t know what you’ll encounter. You struggle more, sure, but you also see things that you would have never seen if you would have gone there with a plan.

If you’re looking to have fun, most places will do. But if you’re looking to grow your mind, I’d recommend to go with the least information possible, to the least known place.

Finally, one more reason to visit most countries outside of Europe and North America when you’re young: they’re changing. While Europe is going to look pretty much the same 20 years from now (unless a natural disaster strikes), most countries in South East Asia and Latin America, for example, won’t be.

8- Education is screwed up pretty much everywhere

This was ignorant of me, but I truly expected university life in Australia to be different from Argentina. Supposedly, it’s first-world class. And from an infrastructure perspective, I can see that. But besides its multi-ethnicity, I didn’t see any major benefits from attending college there. And for their exorbitant fees, value in return should be obvious.

I had top grades while I was there, and had no problem socializing. There was nothing wrong with me as a student, except for the fact that I had prior experience with similar education for much lower costs (public education is free in Argentina).

This was my third strike with higher education, and the one that cemented my opinion that education is a problem worldwide. If my involvement with education activism ever leads somewhere positive, I’ll look back to my experience in Australia as the breakthrough moment that inspired me to act.

9- A minimalist lifestyle is a great first step towards stoicism

Minimalism means many things for many people, but there’s one aspect where everyone can agree: it’s about having less. I don’t consider myself a minimalist, or any label for that matter, but when you move so far from everything you own, you need to leave things behind. Minimalism is enforced upon you.

We all go through little minimalist experiments every time we pack before a trip. We choose what to take with us, and what to leave at home. My real epiphany came the moment I chose to take that decision to the extreme. Before going to Vietnam, I decided to only take what would fit in a very small bag, and it was a very fulfilling experience. I was flexible to move around, and I realised how little I actually needed.

When you have less, you learn to live with less.

This is what stoicism is about: appreciating what we have. Every time I find myself wanting some new gadget or piece of clothing, it helps to remember how much I enjoyed my time in Vietnam, with very few possessions at hand. Minimalism is a good experiment that we can all try every now and then, not to adopt it as a life philosophy, but to focus on the important things in life.

10- For the active mind, life has too many inputs to have rigid and specific long term plans

I’ve been called impatient and inconsistent many times, mostly by people close to me. I used to think that they may have a case, but I don’t anymore. For the active and responsible person, consistency has nothing to do with time spent doing something, or with following through with a plan. It’s all about input.

If you are a person that’s constantly reading, learning, experimenting, networking, traveling, or engaging in any sort of pursuit with high input activity, you will change direction more often. You’d be stubborn and/or dumb not to. When you receive new information, it’s only logical that you adapt to it to make sure you’re on the right track (this is what Seth Godin talks about in The Dip: things should be completed only if it makes sense to do so, otherwise we should re-evaluate our plan immediately).

I went to Australia thinking I was going to live there for, at least, the 3 years it would take me to finish my degree. But the feedback I got was too heavy not to reconsider my plan. Thanks to not worrying about sticking to some mystic blueprint, I was able to process the input quickly, and make the necessary changes. It’s because I’ve always believed in this that my life has seen a steady rise in personal growth, positive habits, life satisfaction, independence, healthy relationships and financial comfort.

I can’t stress this enough: if you are constantly engaging in activities that provide new information, it’s mandatory that you’re willing to analyze it and act on it. What’s the point in learning anything if you’re not going to use it? People with slow iteration cycles won’t understand your decision-making, because you’re learning too fast for them.

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Bonus lesson: Gandhi is not loved by everyone in India.

According to my friend Mandeep, Gandhi is seen as a british ally, and the real revolutionary was Subhas Chandra Bose. It doesn’t really matter how many people feel this way, what matters is that somebody does. We learn in the western world that there’s nothing purer than Gandhi, Mother Theresa and Einstein. It’s good to talk with real people to get real opinions, instead of what the media forces down our throats.

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