Authors Sahil Bloom
A thread on how it works and how it can change your life...
Dwight D. Eisenhower was an American military officer and politician.
He was a five-star general in the United States Army and the first Supreme Commander of NATO.
After his military career, he was elected as the 34th President of the United States, serving from 1953 to 1961.
In both his military and civilian careers, Eisenhower stood out for his prolific productivity.
Eisenhower observed that people often confuse the urgent with the important. He did not.
"What is important is seldom urgent and what is urgent is seldom important."
The Eisenhower Decision Matrix is a visualization tool that forces you to differentiate between the urgent and the important.
It allows you to prioritize your time accordingly and unlock new productivity and growth.
Let's cover the basics of how it works...
First, we have to define "urgent" and "important."
An "urgent" task is one that requires immediate, focused attention.
An "important" task is one that promotes or furthers your long-term values, goals, or principles.
Remember: Tasks can be both urgent and important.
Tulip Mania has become a legend synonymous with market euphoria and bubbles. But is this tale all it's cracked up to be?
Who's up for a story?
1/ The tulip is a spring-blooming flower native to the valleys of the Tien Shan Mountains in Central Asia.
It is believed to have been introduced to Europe in 1554, when an ambassador of the Holy Roman Emperor sent tulip bulbs and seeds to Vienna from the Ottoman Empire.
2/ Tulips gained in popularity as people were attracted to their rich color and ability to grow in sub-optimal conditions.
They soon became a coveted status symbol for the wealthy.
The Semper Augustus, with its colorful, flame-like streaks, was the most desired of them all.
3/ By the early 1600s, the Dutch Republic was entering a golden age.
Many financial innovations popped up during this time - the first stock exchange, for example.
But it was another financial innovation that would propel tulips into historical lore: the futures contract.
4/ As tulips grow slowly and may take several years to bloom, paper contracts were written that entitled the buyer to the future tulips.
These contracts were freely-traded.
So in addition to the physical market for tulip bulbs, a thriving paper market was established.
But contrary to what you’ve been told, lifelong learners are built, not born.
THREAD: 20 lifelong learning habits you can start developing today.
The mind is a muscle - it needs to be stimulated dynamically to continue to grow.
Don’t rely on one “exercise” - develop a menu of options.
Write, read, listen, watch. Solve puzzles, play games. Enjoy it!
Stimulate dynamically, learn dynamically.
Build Learning Circles
The most powerful learning is communal, not individual.
Build learning circles with other intellectually curious minds.
Engage regularly with no set intention or goal.
Community is everything. Embrace it.
Keep Asking Why
“Why?” is the most useful tool in our learning toolkit.
But somewhere along the line, we are told to stop asking why and just accept “facts” as we are told them.
Reject the norm.
If you want to understand the world, take a cue from our kids - keep asking why!
Adopt a Process Orientation
Learn for the sake of learning, not always for a specific goal.
When you prioritize process, you become flexible in where you are headed.
Life is a winding, confusing journey - forward progress is all that matters.
A short thread on how it works and how it can change your life...
Jeffrey Preston Bezos is an American entrepreneur and technologist.
He is most well known as the founder and CEO (soon-to-be executive chairman) of Amazon and the founder of Blue Origin.
A legendary figure today, he may have remained anonymous if not for one key decision.
In 1994, at age 30, Jeff Bezos was a star at D.E. Shaw, a successful quant-focused hedge fund.
He was on a lucrative path.
But he had become obsessed with a new thing called "the internet" and its power to change the world.
He had a vision of participating in that future.
Bezos had a decision to make.
Stay at D.E. Shaw - with a high likelihood of wealth creation and "success" - or leave and pursue his speculative, crazy new idea.
He developed a framework for making this (and many future) decisions:
The Regret Minimization Framework.
The Regret Minimization Framework is simple.
The goal is to minimize the number of regrets in life.
So when faced with a difficult decision:
(1) Project yourself forward into the future.
(2) Look back on the decision.
(3) Ask "Will I regret not doing this?"
(4) Act accordingly.
A thread on how it works and how it can change your life...
Richard Feynman was an American theoretical physicist.
He won the Nobel Prize in Physics in 1965 for his groundbreaking work in quantum electrodynamics.
Feynman's true genius, however, was in his ability to convey extremely complex ideas in simple, digestible ways.
Richard Feynman observed that complexity and jargon are often used to mask a lack of deep understanding.
The Feynman Technique is a learning framework that forces you to strip away needless complexity and develop a deep, elegant understanding of a given topic.
The Feynman Technique involves four key steps:
(2) ELI5 ("Explain It To Me Like I'm 5")
(3) Reflect & Study
(4) Organize, Convey & Review
Let's cover each step and how you can make this powerful framework work for you...
Step 1: Identify
What is the topic you want to learn more about?
Identify the topic and write down everything you know about it.
Read and research the topic and write down all of your new learnings (and the sources of each).
This first step sets the stage for what is to come.
But contrary to what you have been told, most of it has nothing to do with investing.
10 powerful lessons for life from the Oracle of Omaha:
Wait For A Juicy Pitch
“You don't have to swing at everything - you can wait for your pitch."
Life doesn’t reward you for the number of swings you take.
Focus on identifying the juiciest pitch.
When it comes, swing hard and don’t miss it.
Just Stop Digging
“The most important thing to do if you find yourself in a hole is to stop digging."
When things aren’t working, change course and try something different.
Be nimble. Be agile.
When you find yourself at the bottom of a hole, stop digging and climb out of it.
“Price is what you pay. Value is what you get.”
Seek out situations where there is a clear disconnect between price and value.
This applies to investing, but it’s more broadly a mental model for life.
Identify disconnects. Exploit them to your advantage.
“Be fearful when others are greedy and greedy when others are fearful.”
Following the crowd is easy, but it can be a trap.
Learn to think independently. Come to your own decisions. Develop your own mental models.
Your unique perspectives are your superpower.
THREAD: 20 common logical fallacies to learn, identify, and avoid:
Latin for "to the person" - an attack of the person rather than the argument.
Instead of addressing the argument and its points and merits, the offender attempts to refute the opposition on the basis of personal characteristics.
All-too-common in politics.
The Texas Sharpshooter
A Texan fires a gun at a barn wall and then paints a target around the closest cluster of bullet holes to create the appearance of accuracy.
Selecting and highlighting evidence that supports the conclusion while ignoring evidence that may refute it.
The Bandwagon Fallacy
An assumption of truth on the basis of the majority of people believing it to be true.
"Everyone believes X, so obviously X is true."
Typically offered without regard for the qualifications or ability of the people in question to validate the claim.
The offender ignores the actual argument and replaces it with a flimsy, distorted, easily-refuted argument (a “straw man”).
By replacing a strong argument with a weak one, the offender can create the illusion of an easy, swift victory.
He would go on to found and build the most strategically important company in the world.
Who's up for a story?
1/ Morris Chang was born into a middle-class family on July 10, 1931 in Ningbo, Chekiang, China.
The early years of his life were set against a backdrop of hardship.
Wars and widespread poverty had overwhelmed the country, exposing him to this suffering at a young age.
2/ His father - an official in the local government - encouraged Morris to focus on school.
Fleeing the violence of the ongoing wars, Morris and his mother moved frequently.
His studies became his respite.
In 1948, at the height of the Civil War, they moved to Hong Kong.
3/ In 1949, Morris Chang was accepted to Harvard University.
He moved to America.
After just one year at Harvard, he transferred to The Massachusetts Institute of Technology (MIT) to study engineering.
He graduated in 1953 with a B.S. and M.S. in Mechanical Engineering.
4/ While he had originally intended to continue his studies and get a PhD, he failed his qualifying exam, so was forced to enter the job market.
He took an entry-level job with Sylvania Semiconductor, but quickly realized the company wasn't forward-thinking enough for his style.
Fortunately, these skills can be learned.
THREAD: A simple, powerful mental model for thinking clearly and solving complex problems:
When solving problems, the human mind is wired to think in linear, logical, forward terms.
But as the problems get increasingly complex, this forward, logical process often fails.
Enter our simple, powerful mental model: inversion.
What is inversion?
Inversion is a mental model and thinking tool used by some of the world’s greatest thinkers and problem solvers.
Simply put, it says that when problems become challenging to solve forwards, they may be more readily solved backwards.
Inversion as a general thinking tool has been around for millennia.
Stoic philosophers had premeditatio malorum - “the pre-meditation of evils” - an exercise in which they would imagine the worst case scenario ahead of time.
It allowed them to make plans to avoid this outcome.
The formal mental model was popularized by German mathematician Carl Jacobi in the mid-1800s.
When faced with difficult problems (which happened frequently in his field of elliptic functions!), he had a strategy: “Man muss immer umkehren.”
Translation: “Invert, always invert.”
A thread on its meaning and how it can change your life...
Ikigai is a combination of the Japanese words “iki” (or “life”) and “gai” (a term to describe value or worth).
It roughly translates to “reason for being.”
It is all-encompassing - it is not simply about work, money, or success - it is about the full scope of your existence.
Ikigai is the point of balance and harmony in your life and work.
It is found at the intersection of:
(1) What you love to do
(2) What you are good at
(3) What the world needs
(4) What you can be paid for
Importantly, it is at the nexus of passion and practicality.
The concept of Ikigai can be traced back to 12th century Japan, but its exact genesis is unknown.
It gained a mainstream following after Dan Buettner’s famous 2009 @TEDTalks on his research on @BlueZones (regions where people live longer than average).
In his research, Dan Buettner found that purpose and fulfillment led to improved longevity.
Put simply, embracing the concept of Ikigai contributed to enhanced health (mental and physical) and longer lifespans.
But many of life’s most important truths appear contradictory on the surface.
THREAD: 15 powerful paradoxes (on growth, business, careers, and life):
Sprezzatura (“Studied Carelessness”)
You have to put in more effort to make something appear effortless.
Effortless, elegant performances are often the result of a large volume of effortful, gritty practice.
Simple is not simple.
Slow Down to Speed Up
Want to speed up? Try slowing down.
Slowing down gives you the time to be deliberate with your actions.
You can focus, gather energy, and deploy your resources more efficiently.
It allows you to focus on leverage and ROI.
Move slow to move fast.
Learn More to Know Less
The wisdom paradox - the more you learn, the more you are exposed to the immense unknown.
This should be empowering, not frightening.
“The more I learn, the more I realize how much I don't know.” - Albert Einstein
Embrace lifelong learning.
Lifelong learning is a competitive advantage.— Sahil Bloom (@SahilBloom) June 6, 2021
But contrary to what you\u2019ve been told, lifelong learners are built, not born.
THREAD: 20 lifelong learning habits you can start developing today.
Shrink to Grow
Growth is never linear.
In order to grow, sometimes you need to shrink.
Shedding deadweight may feel like a step back, but it is a necessity for long-term growth.
This principle applies to your career, startup, or life.
One step back for two steps forward.
Many of the brightest minds in the investing world share one common trait: they recommend dollar cost averaging as an investment strategy.
But what is dollar cost averaging and how does it work?
Here's Dollar Cost Averaging 101!
1/ Dollar cost averaging, or "DCA" for short, is a simple investment strategy in which an investor splits the total amount to be invested in a given asset across regular periodic purchases.
The regular purchases occur regardless of price, volatility, or economic conditions.
2/ The goal is to remove the complexities of market timing from the process, allowing an investor to build their desired position without concern for external factors.
Its simplicity removes behavioral and psychological biases from the equation.
Let's look at an example.
3/ Imagine you want to build a $10,000 position in bitcoin. You have done your research and believe in the long-term story.
You aren't sure if it will go up or down in the near-term, so you decide to dollar-cost average.
Great decision! How will you do it?
4/ You split the $10,000 up into 20 pieces ($500 each). You could have done any number of pieces, but 20 felt right.
You decide on a weekly DCA, so every Monday, you buy $500 of $BTC, regardless of price. After 20 weeks, you have built your desired $10,000 cost basis position.
A perfect moment for a thread on the Hunt Brothers and their alleged attempt to corner the silver market...
1/ First, let's set the stage.
The Hunt Brothers - Nelson Bunker Hunt, William Herbert Hunt, and Lamar Hunt - were the sons of Texas tycoon H.L. Hunt.
H.L. Hunt had amassed a billion-dollar fortune in the oil industry.
He died in 1974 and left that fortune to his family.
2/ After H.L.'s passing, the Hunt Brothers had taken over the family holdings and successfully managed to expand the Hunt empire.
By the late 1970s, the family's fortune was estimated to be ~$5 billion.
In the financial world, the Hunt name was as good as gold (or silver!).
3/ But the 1970s were a turbulent time in America.
Following the oil crisis of the early 1970s, the U.S. had entered a period of stagflation - a dire macroeconomic condition characterized by high inflation, low growth, and high unemployment.
4/ The Hunt Brothers - particularly Nelson Bunker and William Herbert - believed that the inflationary environment would persist and destroy the value of their family's holdings.
To hedge this risk, they turned to silver.
They began buying the metal at ~$3 per ounce in 1973.
I got 2,000+ responses.
THREAD: 20 of the most iconic marketing and advertising campaigns in history:
De Beers “Diamonds are Forever”
Arguably the most iconic, controversial, and impactful marketing campaign in history.
Created the massive, global diamond industry.
(Note: This will be the subject of a future thread…)
Coke vs. Pepsi Superman Battle
Pepsi ran the Halloween ad on the left. Coke responded with the ad on the right.
Game, set, match.
The Original Apple iPod Campaign
“1,000 songs in your pocket”
Simple, intuitive, genius.
Starbucks Wrong Names on Cups
Starbucks employees writing the names of millions of customers in hilariously wrong ways to get them to post the images across social media with Starbucks branding.
With Bitcoin's return to the spotlight, debates on its long-term viability are raging. Its proponents contend @nntaleb's Lindy Effect says the technology is here to stay.
But what is the "Lindy Effect" and how does it work?
Here's Lindy Effect 101!
1/ First, a few definitions.
The Lindy Effect is a theory that the future life expectancy of specific non-perishable items, like a technology or idea, is proportional to their age.
Put simply, the longer it has already lasted, the higher the likelihood it will continue to last.
2/ The term "Lindy effect" is a reference to Lindy's, a New York deli frequented by comedians in the 1960s.
While author Albert Goldman used the term "Lindy's Law" in a 1964 article, it was mathematician Benoit Mandlebrot who moved the dialogue towards the current definition.
3/ In his book, entitled The Fractal Geometry of Nature, Mandlebrot commented that the more stage appearances a Lindy's comedian made, the more future appearances he could be predicted to make.
The longer he lasted, the longer he would continue to last.
4/ @nntaleb built upon Mandelbrot's work, formally coining the term "Lindy Effect" in his book, Antifragile.
He noted the Lindy Effect with books - the longer a book has been in print, the longer it is likely to survive.
With no natural upper bound, power laws come into play.
How to Win (without talent or luck)
20+ principles compiled from the most impressive leaders and thinkers in the world.
How to Win (without talent or luck):— Sahil Bloom (@SahilBloom) October 16, 2021
20 Ways to Stand Out in a Hiring Process (that don’t involve your resume)
You can stand out without fancy degrees or credentials—learn how.
The hiring process is ultra-competitive.— Sahil Bloom (@SahilBloom) May 31, 2021
But you\u2019ve incorrectly been told that the only way to stand out is by having fancy degrees and credentials.
THREAD: 20 ways to stand out in a hiring process (that don\u2019t involve your resume):
Common Interview Questions (& how to nail them)
Interviews suck—proper preparation makes them suck slightly less.
The interview process is ultra-competitive.— Sahil Bloom (@SahilBloom) August 7, 2021
But with proper preparation, it is possible to stand out.
THREAD: 20 common interview questions, what they really mean, and how to nail them:
How to Write Cold Emails (or DMs)
Because one lucky break can make all the difference…
One cold email can change your life.— Sahil Bloom (@SahilBloom) October 24, 2021
Here's how to write a great one:
A thread on its meaning and how it can change your life...
Memento Mori is a Latin phrase that translates to "remember that you must die."
A favorite of Stoic philosophy, it is a reminder of the certainty and inescapability of death.
It is not intended to be morbid or dark; rather, to clarify, illuminate, and inspire.
Memento Mori - the idea of remembering your mortality - has been around for millennia.
The phrase itself is believed to have originated in the Roman Empire.
After military victories, the heroes were paraded through the streets on chariots.
They may have felt like Gods...
But the Romans would place one person in the chariot whose sole responsibility was to whisper in the hero's ear throughout the parade.
"Respice post te. Hominem te esse memento. Memento mori!"
Translation: "Look behind. Remember thou art mortal. Remember that you must die!"
Memento Mori served as a tool to invoke humility in moments of glory.
It can also be a tool for providing clarity.
The Roman Emperor Marcus Aurelius famously wrote in his Meditations, "You could leave life right now. Let that determine what you do and say and think."
If you follow financial markets (or if you watch Billions), you've heard the phrase "short squeeze" used quite frequently.
But what is a "short squeeze" and how does it work?
Here's Short Squeeze 101!
1/ First, the basics.
The "short" in "short squeeze" refers to the concept of short selling.
The basics are covered in my thread below.
TL;DR - short selling is a way of betting against a stock - i.e. betting that its price will decline.
1/ Short Selling 101— Sahil Bloom (@SahilBloom) July 6, 2020
With the markets continuing to rally, there has been more talk of \u201cshorting\u201d or \u201cshort selling\u201d stocks.
But what does that mean and how does it work?
Here\u2019s a quick educational primer: Short Selling 101 pic.twitter.com/JTrJmuY7fI
2/ "Short interest" is a measure of how heavily an asset is shorted by the market.
It is the total number of shares that have been sold short (borrowed and sold), but have not yet been covered (bought and returned).
It is usually measured as a % of the # of shares outstanding.
3/ A "short squeeze" occurs when a heavily-shorted asset experiences a rapid upward price movement.
When this happens, short sellers may be forced to close their short positions (i.e. buy the stock and return it to the broker), further accelerating the upward price movement.
4/ Let's look at a simple example to show this in action.
We will use Tesla, one of the most heavily-shorted stocks in the world.
Imagine the stock price is $1,000 per share. This seems crazy. Ricky Rational decides to short the stock at this level.
A thread on the underlying mechanics of the $GME saga...
1/ First, for those unfamiliar with the business, GameStop is a videogame and merchandise retailer.
It has >5,000 stores, primarily in malls, across North America, Europe, and Australia.
The business has struggled to modernize, hurting its financial and stock performance.
2/ For a variety of business reasons, a bull (i.e. optimistic) case regarding its future performance has formed.
It really came to the forefront after RC Ventures, an entity managed by Chewy founder @ryancohen, disclosed a large position and assumed three board seats.
3/ @ryancohen summarized his case, stating:
"We are excited to bring our customer-obsessed mindset and technology experience to GameStop and its strategic assets...expanding the ways in which it delights customers and by becoming the ultimate destination for gamers."
4/ At the time of that statement on January 11, $GME stock was trading at about ~$20 per share.
Since then, the stock has surged to ~$200 per share and captured the public imagination.
But how did it happen?
There are two dynamics at play: a short squeeze and a gamma squeeze.