Cached Thoughts and More

Shoutout to Liberty's Highlights

One of my favorite Substack authors is Liberty of Liberty’s Highlights. It is published 3 times a week (Monday, Wednesday, and Friday) and covers a range of topics on business, investing, technology and arts. Most importantly though, I’m impressed by the cut of his jib. In other words, I like the way he acts, thinks, or approaches life.¹ This week I’m going to share a few topics that have come up in his newsletter, offer my thoughts on them, and encourage you to check it out for yourself (and maybe even become a subscriber).

Life is trade-offs. If you try to please everyone, you usually end up pleasing no one, especially yourself. Liberty Issue #16

I discovered Liberty’s Substack page a few months back and he’d been publishing it for awhile at the time. While I’ve enjoyed the current releases, I hadn’t really gone back into the archives until writing this up. Today, I decided to look around at some of his earlier pieces and noticed that it took him awhile to get into the current format which spends some time with general ideas before getting into updates of things he finds interesting. The quote above is from Issue #16 and captures the spirit of the newsletter (by the way, I never really know what to call these Substack posts — are they posts, blogs, newsletters, issues, or something else?) I try to write things that I’m interested in talking about and hope that you find them interesting enough to follow along.

Cached Thoughts

One of the intriguing concepts he introduced last week is the idea of cached thoughts. This relates to the idea of original thinking, but recognizes that original thinking is much, much harder than most of us tend to believe. Here is his snippet from Liberty Issue #184:

Lots of people think they’re thinking, but they’re actually just “replaying” in their brains other people’s thoughts that they’ve cached (in a CPU, the cache is a type of very fast memory where you try to store data that you’re likely to have to re-use more than once, so you look up the saved result rather than re-compute things from scratch).

This implies that there’s two main ways to have original thoughts:

1. Actually be an original thinker. Use first-principle thinking, be skeptical, think things through, do your own research, look at primary sources and come with your own conclusions, and whatever else original thinkers do.

2. Mostly replay cached thoughts like most of us, but be curious enough about a wide variety of things so that the Venn diagram of your specific cached thoughts ends up being pretty unique. The Lego blocks that you’re playing with may be unoriginal, but with them, build an original combination/structure.

I guess ideally you would do 1+2, but just getting to a partial #1 or #2 probably puts you in a fairly rarefied group, so don’t beat yourself up too much if self-scrutiny reveals you don’t have many original thoughts.

If you think of my newsletter here, I am far more of a “replaying cached thoughts” guy rather than an original thinker. Note that I’m not using this in a derogatory fashion. I agree entirely with his argument that being able curate a reasonable “view” from other people’s thoughts is a significant accomplishment. To do so, you need to

1. Be aware of the thoughts

2. Be able to connect the links between thoughts from other people and

3. Present your take on why this connection is relevant or how to benefit from it.

This can be harder than we often give it credit for being. Consider areas in which you are better than average. We all have them whether they are cooking, artistic endeavors, a particular sport, scrapbooking, behavioral finance, computer networking, or any of hundreds of other different activities. I’m trying to up my understanding a little bit of issues like cybersecurity, semiconductors, and computer networks and each attempt makes me feel like a toddler trying to comprehend brain surgery.

Let’s say that I read something interesting. For example, in “Noise: A Flaw in Human Judgment” by Daniel Kahneman, Olivier Sibony, and Cass R. Sunstein there is a section that talks about how meetings can be unproductive due to the order of who speaks. Specifically, if the first person to offer their view is negative on the idea, that can set the tone for the groups consensus, as others will have a tendency to defer to the first speaker. Instead, if we get everyone’s opinion first (before they are aware of anyone else’s view) and then discuss the opinions as a group, we are probably going to have better results. This is NOT an original thought of mine. However, there are two ways I can make it useful. First, the book Noise is nearly 400 pages long and not exactly a light read. If I can read it, identify the parts that are important, and relay those ideas to a group of people in an hour, we are going to collectively save quite a bit of time. It may take me 10-20 hours to read, comprehend what I’m reading, and select the important takeaways. If there were 10 of us doing this, it would be 100 - 200 hours. However, if I put in 20 hours and then spend an hour conveying what I learned, we are now down to 31 hours total (my 20 hours + 1 hour from each of the 10 “students” + my hour presenting). Even if it took me 5 hours to put together the presentation, we are still under 40 hours and saving over 60 hours of time.

A second benefit can come from connections I (or you) can make to another area. This is the "analogy” concept that David Epstein covers in his book “Range: Why Generalists Triumph in a Specialized World”.² By making connections across topics we can better understand things.

Analogical thinking takes the new and makes it familiar, or takes the familiar and puts it in a new light, and allows humans to reason through problems they have never seen in unfamiliar contexts. It also allows us to understand that which we cannot see at all.

Mr. Epstein discusses how Johannes Kepler developed the Laws of Planetary Motion using analogical thinking to other fields he was familiar with (such as odor, heat, light, currents, and magnets).

Having knowledge about multiple concepts and being able to connect those concepts is incredibly powerful. This allows you to create a Venn Diagram unique to you and generate insights that many others will not have. They are not truly “original” thoughts, but the impact can be just as powerful.

The Last Time

There are some things you do for the last time, but you don't realize it at the time. It's only looking back that you know. — Liberty Issue #186

This is something that I had read about before with respect to running. I suppose some people will keep running throughout their life, but for most people, they are runners up to the point that they are not. I imagine it is not a conscious decision where someone thinks “Well, I’ll get my 35 miles in this week…and then, you know, I guess that’s probably it and I’ll never go out on a run again.” Maybe it’s a race (5K, half marathon, marathon, etc.) that you are training for and once you’ve run that event, running is checked off the list and you move to the next accomplishment. Or, you get an injury out on a run and by the time you recover enough to run again, you have moved on to something else. I lifted weights (not very successfully) for a few years and then decided that I was done with it. That was probably 15 years ago and I haven’t intentionally lifted weights since then. However, before that last session of lifting, I didn’t think to myself “Kevin, this is the last time you are going to lift…make it a good session.”

What things have you done in your life that you don’t do anymore? Who are some friends that you used to hang out with and haven’t talked to in years? What caused the break and is it something you’d like to restart? If so, it’s time to get back on the horse.

Motivation for Learning

I feel like one advantage autodidacts have is that they learn *because they want to learn*, they actually try to understand to scratch an itch. As with everything, motivation matters a lot.

In school, you learn on someone else's schedule because you have to to pass a test, so you do whatever you have to to get that grade, but may not truly learn much, understand, or retain for long. A lot of it is more about “guessing the teacher’s password” than learning something well enough that you could teach it to someone else who doesn’t know it. — Liberty Issue #182

This one really hit home as it was one of the things I struggled with over my last few years of teaching. There was always a split among students between those there to check the box and move on, those that were interested in learning…but had lots of other things on their plate, and those that really wanted to learn because they were interested in doing so. That is not a criticism on the students. I took classes where I was just wanting to get the class done because it was a requirement and didn’t really care about what I was learning when I was in there shoes. I also had other classes where I really wanted to learn the material because it intrigued me. Some days I even found myself checked out in classes that I enjoyed because my mind was elsewhere. It happens.

One of the challenges of academics (and I would argue this occurs in K-12 as well as universities) is that teachers design courses assuming students are interested in learning what we have to teach (the accuracy of that assumption varies depending on both the material and the student).³ However, I would argue that most students are more concerned with the grade that they are going to earn, rather than truly understanding the content and how to apply it to their life. Again, this is not criticism. Students are rewarded based on grades. When you are trying to get into college, admissions will (not entirely, but to some extent) look at your grades and class rank. Many academic scholarships require students to maintain a specific GPA in order to qualify for the scholarship and/or to extend the scholarship for future years. Top employers and graduate schools will often only consider students who meet specific GPA requirements for interviews. As a student, if you do not get good grades, this significantly hinders your ability to progress forward. A student with a 3.85 who achieved that GPA by focusing on grades may not understand the material as well as a student with a 3.25 GPA, but may be on a better path to success because of the opportunities created by the higher GPA. Alternatively, a student with a 3.25 GPA may not be eligible for scholarships. This could force that student to work more hours in order to afford college, causing their GPA drop even further. GPA is an easy metric to measure, which creates the perverse incentive to manage it even to the extent where managing it harms the person doing so.⁴

You don’t want to be in a perverse incentive system that’s causing you to behave more and more foolishly or worse and worse. Incentives are too powerful a controller of human cognition and human behavior, and one of the things you are going to find in some modern law firms is billable hour quotas and I could not have lived under a billable hour quota of 2,400 hours a year. That would have caused serious problems for me. I wouldn’t have done it and I don’t have a solution for you for that. You have to figure it out for yourself, but it’s a significant problem. — Charlie Munger from his 2007 USC Law School Commencement Address

Incentives are incredibly powerful motivations and, at least in part, there are some perverse incentives in the educational process. We know that cramming for tests is ineffective. Now talk to any college student (or high school student) and ask them how often that technique is used to get ready for exams. You’ll find it is immensely popular, despite being ineffective for learning. Why? Because cramming DOES help short-term memory, even if it doesn’t help long-term learning/understanding.

I don’t have a solution, but trying to better align incentives for long-term learning and understanding of concepts needs to be a priority.

Gaining By Giving

One of my recurring ideas, that I keep coming back to over and over, is that on the internet, there’s many many others, but there’s always just one of you.

It’s obvious on the first level, but what makes it powerful is the implication: if you focus on helping others and providing value, eventually you'll get back as much as you provide, and then more.

To illustrate: If only 5% of people give back to you, at first it may seem one-sided when you're only connected* to 20 people (I mean real connections, not just low-intensity “follows” on a social network).

But when you're connected to 200 people, things get inverted real quick and suddenly you get back 10x what you contribute. The beauty of the model is that it scales in both directions, so your contributions can be enjoyed by thousands of people. It’s all very non-zero sum.

You improve much faster in the arena, not sitting on the sidelines, and if you're doing it all in good faith and don’t pretend to be something you’re not, lots of people will point you in the right direction to learn, and help you correct your mistakes much quicker than you'd do on your own.

Work on what you can contribute rather than focus on what you’re getting — do unto others as you wish others did unto you, and all that jazz. Good things will happen for all involved. 💚💚💚💚💚 — Liberty Issue #165

This ties back into teaching the introductory chapter in Business Finance classes for several decades where I would stress that the ultimate goal was to maximize shareholder value.⁵ If you are adding value to someone else, by definition it is in their best interest to keep you around. One way for them to do that is to return the favor and add value back to you. You might have heard the phrase “win-win” before (and yes, I’m being sarcastic as we’ve all heard it about 10 times more often than we wanted to), but this reciprocal relationship is at the heart of social interactions. The beauty of the internet is that it eliminates geographic boundaries and allows you to connect with people from all over the globe with similar interests. Sure, you may struggle to physically connect with anyone that is interested in hiking the Superior Hiking Trail (especially if you live in SW Missouri like me).⁶

However, with the internet, there are thousands of people (nearly 33 thousand members of the SHT group on Facebook) with the same interest to connect with, ask questions, and share experiences. Sure, the internet can (and does) bring out the worst of us, but it also unleashes the potential to bring out the best of us. The key is to use it appropriately. While this is something that is very much a “work-in-progress” for me, it is something that I can work on. If you know me, you know my highly introverted nature will make this a slow process.

Are You Still There?

One thing that I haven’t had yet are any comments. So, if you are out there reading this and have any thoughts or suggestions for topics or feedback on how the Substack is progressing, let me know. What areas make up YOUR Venn diagrams? What have you done for the last time? Any thoughts on better aligning incentive to engage learners? While I am writing this more for my own benefit than for yours, ideally we are all getting something out of it. So share your thoughts if you have some. Also, if you made it this far and you think that other’s might get some value from reading along, share my Substack, Liberty’s Substack, or both!

1. For those who don’t follow links (you probably aren’t following this footnote either), but the phrase “cut of your jib” comes from sailing ships which included a “jib” sail in the front of the ship designed to reduce turbulence from the other sails. By being in the front of the ship it was easiest to see from a distance and a way to help identify whether the ship was friend of foe. I’d also add the disclaimer that having never met or talked to Liberty (which I’m going to go WAY out on a limb here and assume is not his actual name), I’m assuming that the image from the newsletter is a reasonable overview of the actual person.

2. Let me get in a second plug here for David Epstein — who is another writer for whom the “I like the cut of his jib” sentiment applies. If you want a free weekly newsletter by Mr. Epstein, you can subscribe here. Seriously, great content for free is pretty hard to beat.

3. And often, the “content” of the course may not be exactly the takeaway that I wanted students to learn from the course. For example, when I was teaching an MBA course in corporate finance, I wanted them to learn some of the basic concepts of finance. However, I more wanted them to learn how to think critically about certain concepts like “False Precision.”

4. https://www.theguardian.com/business/2008/feb/10/businesscomment1

5. And yes, I’m well aware of how “cold” that sounds. However, remember that I’m one of those strange people who believe that capitalism DONE RIGHT is a source of great good for society. We can debate how often it is done right and I’ll quickly give you lots of room there as focusing on the long-term impacts of decisions is much harder than we recognize for all of us (yes, including myself).

6. Anyone interested in a little backpacking trip on the SHT?