I had a disappointing day this week. An investment fell over 10 percent for reasons I did not believe were fully justified. The stock has since rallied over 5 percent but still on the actual day I felt quite a deal of mental anguish.
Staying in the game
Thoughts on flying and travel
Climate podcast, Chris Stark
Links: how to think on inflation, pausing alcohol, improbable looking for exec director
Experienced and successful investors such as Warren Buffett have written on the psychology of investing. Buffett has suggested that mental temperament is one of the important if not the most important factor to have right for an investor.
The mind finds it hard to deal with large mistakes. We review our reasons. We wish it were not so. We fall back on platitudes.
No crying over spilt milk.
But, most of us know mistakes are still hard for the brain. Events out of our control. Events, we don’t feel are fair. There are a variety of techniques people use. Personally I like to think of this form of mental resilience as a type of mental gym. The best techniques are regularly keeping your mind fit to withstand the stresses of unwelcome events.
I lack a large story of resilience. Perhaps, continuing to create and perform after my Dad died, or when as a teenager I learned of his cancer could be told as a story. Yet, I feel that story has a too familiar arc. My stories tend to be little every day resilience that build up. Mental gym.
On the large story arc, I will instead link you to this story from another investor writing more as a parent. This is a wider story about « staying in the game » and the stories we might need to tell ourselves to keep ourselves in the game.
From Drew Dickinson
My son Max was born in Detroit in 1997, he spent the next summer in Hong Kong when I was interning at Fidelity Investments, and moved to London before he was two when I accepted an offer to work for Fido there full-time.
He was an amazing child, and became an amazing young man. But he had his demons. And just before he turned 16 years old, those demons arrived with a vengeance. I will spare you the details, but for the next three years, he went through a personal hell. Imagine all the things you don’t want to have happen to your teenager. They happened to him. For three years my wife and I would wait on our front stoop until 5:00 am, in the shadow of the Albert Bridge, hoping that he would come home. On those nights that he didn’t, we would call the hospitals, and call the police. And sometimes the police would call us.
There are many avenues that parents can take in these situations, and we were very lucky that we could afford to just about try them all. But none of them helped. The change in schools didn’t help. The psychologists didn’t help. The wilderness therapy didn’t help. Our closest friends and extended family all waded in too, but nothing helped.
….At the darkest point, he almost called it. And there was nothing we could do about it. Even if we weren’t 5,000 miles away there was nothing we could do about it.
But, for some reason, he decided not to. Max decided to stay in the game.
More here….https://www.albertbridgecapital.com/post/stay-in-the-game
This in part extends to the climate challenge as well as the personal challenges. You need to be in the game… not give up.
I write this while flying to Boston. The climate movement has made me think about flying in ways I would not have done 20 years ago.
I still see an enormous amount of value in travel. (My blog to travel is to learn:https://www.thendobetter.com/arts/2022/2/12/to-travel-is-to-learn ) The value is in learning, culture and the humanities as well as economic. The value is in fairness and equity too. Poorer peoples who become wealthy enough to fly and travel should arguably be morally allowed to travel.
But, flying is one area that arguably is within an individuals’ control versus many areas where policy or politics are primary driving factors. (Although the decarbonisation of flying is still much a matter of policy and innovation.)
There is a statisic that David Finnigan and I talk about in Bigly Climate that I think it roughly true. In the UK and likely all rich nations, the majority of flights (about 70%) are taken by the minority of people (about 15%).
So, flying speaks to the wealth inequality challenge. Flying to Boston is for work. Ultimately I do put that flight on the work footprint (which is offset) and I do assess if the value I/work gains from the trip is worth the cost (including carbon). It is mostly a qualitative judgment although the higher the flight cost (yes carbon pricing please) the more this weighs in the judgment.
Flying is 2-3 percent of global emissions. Short flights may become electric, but long flights will likely be carbon powered (although perhaps green fuelled) for some time.
The personal signal of being aware of flying does also count for something. Greta has much authenticity and moral authority from her unwillingness to fly.
On that in my recent podcast with the brilliant Chris Stark. He speaks of the UK government signalling on the recent autorisation of a coal mine in Cumbria.
«the coal mine in Cumbria. That is a massive mistake. It's that simple. If you are in a world where you are trying to give signals to the world about what the UK is trying to do on climate change, that matters, it's titanic. But never mind that, that's debatable. If you are a steel company in the UK and you see that we are opening a new coal mine in Cumbria to produce cooking coal for the production of steel, then that is a signal that your government wants to see you use that substance. It completely undermines the effort that then of course two months later is what we're talking about, about how we decarbonize the steel industry with hydrogen in this country.
It's just silly. So we've got a government that cannot speak with one voice on an issue as important as this. I don't think there will ever be a coal mine in Cambria because the investing community is not interested in that kind of uncertainty. So I think probably on that coal mine, the biggest and most problematic signal is to the people of Cambria themselves. I don't think there's kids in school in Carlisle right now thinking, "Oh thank God I've got a coal mine to go to when I graduate from-- when I finish my school education." It's just ludicrous to talk about that. So these signals really, really matter and I think the more that we can align them, the more that we can step away from the expensive policies that you've got to put in place if you want to change to one of those signals that you've wrongly put in place in the first place.
So yeah, I think signals do matter.
more on that here ….Do listen, or watch or read if you are interested in what we should be thinking about in terms of climate policy, which really should be all of you reading this letter. Arguably policy is one of our biggest levers, if not the biggest lever, to pull for climate.
Extremely well listened to in VC world is Marc Andreessen. He helps run a16z. Known for crypto investments as well as anything VC. Marc has stopped drinking and this is in part his annoyance on how it is helping him.
To a lesser extent I feel the same. I really like good red wine and sadly - at the moment and I don’t see it changing any time soon - I hardly drink any more for health, energy and the usual correct reasons.
Marc is well followed for AI thinking as well…
If you want a framework for thinking about inflation and if you believe Team transitory or not. Good insights.
Improbable - theatre and improv - looking to hire senior leadership.