Same as Ever: A Guide to What Never Changes

Our life is indeed the same as it ever was. . . . The same physiological and psychological processes that have been man’s for hundreds of thousands of years still endure. —Carl Jung The wise in all ages have always said the same thing, and the fools, who at all times form the immense majority, have in their way, too, acted alike, and done just the opposite. —Arthur Schopenhauer History never repeats itself; man always does. —Voltaire I’ve learned an important trick: to develop foresight, you need to practice hindsight. —Jane McGonigal The dead outnumber the living . . . fourteen to one, and we ignore the accumulated experience of such a huge majority of mankind at our peril. —Niall Ferguson

History is filled with surprises no one could have seen coming. But it’s also filled with so much timeless wisdom.

Amazon founder Jeff Bezos once said that he’s often asked what’s going to change in the next ten years. “I almost never get the question: ‘What’s not going to change in the next ten years?’ ” he said. “And I submit to you that that second question is actually the more important of the two.”

I have no clue what the stock market will do next year (or any year). But I’m very confident about people’s penchant for greed and fear, which never changes. So

Some of the biggest and most consequential changes in history happened because of a random, unforeseeable, thoughtless encounter or decision that led to magic or mayhem.

Every current event—big or small—has parents, grandparents, great-grandparents, siblings, and cousins.

Viewing events in isolation, without an appreciation of their long roots, helps explain everything from why forecasting is hard to why politics is nasty.

Events compound in unfathomable ways.

One is highlighting this book’s premise—to base predictions on how people behave rather than on specific events. Predicting what the world will look like fifty years from now is impossible. But predicting that people will still respond to greed, fear, opportunity, exploitation, risk, uncertainty, tribal affiliations, and social persuasion in the same way is a bet I’d take.

As financial advisor Carl Richards says, “Risk is what’s left over after you think you’ve thought of everything.” That’s the real definition of risk—what’s left over after you’ve prepared for the risks you can imagine. Risk is what you don’t see.

But that’s the point: The biggest news, the biggest risks, the most consequential events are always what you don’t see coming.

There is rarely more or less economic uncertainty; just changes in how ignorant people are to potential risks.

History knows three things: 1) what’s been photographed, 2) what someone wrote down or recorded, and 3) the words spoken by people whom historians and journalists wanted to interview and who agreed to be interviewed.

Nassim Taleb says, “Invest in preparedness, not in prediction.” That gets to the heart of it.

Two, realize that if you’re only preparing for the risks you can envision, you’ll be unprepared for the risks you can’t see every single time. So, in personal finance, the right amount of savings is when it feels like it’s a little too much. It should feel excessive; it should make you wince a little.

Your happiness depends on your expectations more than anything else.

People gauge their well-being relative to those around them, and luxuries become necessities in a remarkably short period of time when the people around you become better off.

Money buys happiness in the same way drugs bring pleasure: incredible if done right, dangerous if used to mask a weakness, and disastrous when no amount is enough.

Actual circumstances don’t make much difference in all these cases. What generates the emotion is the big gap between expectations and reality.

The first rule of a happy life is low expectations. If you have unrealistic expectations you’re going to be miserable your whole life. You want to have reasonable expectations and take life’s results, good and bad, as they happen with a certain amount of stoicism.

marriage: It only works when both people want to help their spouse while expecting nothing in return. If you both do that, you’re both pleasantly surprised.

One is the constant reminder that wealth and happiness is a two-part equation: what you have and what you expect/need.

The other is to understand how the expectation game is played. It’s a mental game, and it’s often crazy and agonizing, but it’s a game that everyone is forced to play, so you should be aware of the rules and strategies.

realize the consequences of assuming that certainty exists in a world filled with unknowns. A common trait of human behavior is the burning desire for certainty despite living in an uncertain and probabilistic world.

People don’t want accuracy. They want certainty.

It often takes too long for a sufficient sample size to play out. So everyone is left guessing.

Distinguishing between unfortunate odds and recklessness is hard when risk has painful consequences. It’s easier to see black and white even when the odds are apparent.

When a topic is complex, stories are like leverage. Leverage squeezes the full potential out of something with less effort.

The most persuasive stories are about what you want to believe is true, or are an extension of what you’ve experienced firsthand.

Stories get diverse people to focus attention on a single point.

Guiding people’s attention to a single point is one of the most powerful life skills.

Good stories create so much hidden opportunity among things you assume can’t be improved.

“New ways of looking at things create much greater innovation than new ways of doing them.”

Some of the most important questions to ask yourself are: Who has the right answer, but I ignore because they’re inarticulate? And what do I believe is true but is actually just good marketing?

Historian Will Durant once said, “Logic is an invention of man and may be ignored by the universe.” And it often is, which can drive you mad if you expect the world to work in rational ways.

“When you cannot measure, your knowledge is meager and unsatisfactory.”

“The thing I have noticed is when the anecdotes and the data disagree, the anecdotes are usually right. There’s something wrong with the way you are measuring it.”

To suppose that the value of a common stock is determined purely by a corporation’s earnings discounted by the relevant interest rates and adjusted for the marginal tax rate is to forget that people have burned witches, gone to war on a whim, risen to the defense of Joseph Stalin and believed Orson Welles when he told them over the radio that the Martians had landed. That’s always been the case. And it will always be the case.

The ones who thrive long term are those who understand the real world is a never-ending chain of absurdity, confusion, messy relationships, and imperfect people.

Stability is destabilizing. Or, put another way: Calm plants the seeds of crazy. Always has, always will.

A common irony goes like this: • Paranoia leads to success because it keeps you on your toes. • But paranoia is stressful, so you abandon it quickly once you achieve success. • Now you’ve abandoned what made you successful and you begin to decline—which is even more stressful.

Carl Jung had a theory called enantiodromia. It’s the idea that an excess of something gives rise to its opposite.

The same action at different sizes produces massively different problems.

A proper state where things work well but break when you try to scale them to a different size or speed.

People handle risk and responsibility in totally different ways when a group scales from 4 people to 100 to 100,000 to 100 million.

the biggest changes and the most important innovations don’t happen when everyone is happy and things are going well.

Big, fast changes happen only when they’re forced by necessity.

Most catastrophes come from a series of tiny risks—each of which is easy to ignore—that multiply and compound into something huge.

Most amazing things happen when something tiny and insignificant compounds into something extraordinary.

Big risks are easy to overlook because they’re just a chain reaction of small events, each of which is easy to shrug off. So people always underestimate the odds of big risks.

It’s good to always assume the world will break about once per decade, because historically it has.

“My only measure of success is how much time you have to kill.”

a little inefficiency is the ideal spot to be in. Same with analysis. There’s an investing quip that it’s better to be approximately right than precisely wrong.

Everything worth pursuing comes with a little pain. The trick is not minding that it hurts.

enduring the pain when necessary rather than assuming there’s a hack, or a shortcut, around it.

Every job comes with pieces you don’t like. And we need to say: That’s part of it.

nothing worth pursuing is free. How could it be otherwise? Everything has a price, and the price is usually proportionate to the potential rewards.

A good rule of thumb for a lot of things is to identify the price and be willing to pay it. The price, for so many things, is putting up with an optimal amount of hassle.

Body size in biology is like leverage in investing: It accentuates the gains but amplifies the losses. It works well for a while and then backfires spectacularly at the point where the benefits are nice but the losses are lethal.

The only thing harder than gaining a competitive edge is not losing an advantage when you have one.

One takeaway is that you should never be surprised when something that dominates one era dies off in the next. It’s one of the most common stories in history.

Another takeaway is to keep running. No competitive advantage is so powerful that it can let you rest on your laurels—and in fact the ones that appear to do so tend to seed their own demise.

Good advice that took me awhile to learn is that everything is sales. Everything is sales.

“All businesses are loosely functioning disasters,”

What most of us see most of the time is a fraction of what has actually happened, or what’s going on inside people’s heads. And it’s stripped of all the hard parts.

Incentives are the most powerful force in the world and can get people to justify or defend almost anything.

When good and honest people can be incentivized into crazy behavior, it’s easy to underestimate the odds of the world going off the rails.

Unsustainable things can last longer than you anticipate. Incentives can keep crazy, unsustainable trends going longer than seems reasonable because there are social and financial reasons preventing people from accepting reality for as long as they can. A good question to ask is, “Which of my current views would change if my incentives were different?”

It’s not until your life is upended, your hopes dashed, your dreams uncertain that people say, “What was that wild idea we heard before? Maybe we should give it a shot. Nothing else is working, might as well try.”

Future fortunes are imagined in a vacuum, but reality is always lived with the good and bad taken together, competing for attention.

Long term is harder than most people imagine, which is why it’s more lucrative than many people assume.

The long run is just a collection of short runs you have to put up with.

Your belief in the long run isn’t enough. Your partners, coworkers, spouses, and friends have to sign up for the ride.

Patience is often stubbornness in disguise.

“The purpose of the margin of safety is to render the forecast unnecessary.” The more flexibility you have, the less you need to know what happens next.

Simplicity is the hallmark of truth—we should know better, but complexity continues to have a morbid attraction.

The sore truth is that complexity sells better.

What you need is to identify the core principles—generally three to twelve of them—that govern the field.

Complexity gives a comforting impression of control, while simplicity is hard to distinguish from cluelessness.

Things you don’t understand create a mystique around people who do.

Length is often the only thing that can signal effort and thoughtfulness.

My theory is that length indicates the author has spent more time thinking about a topic than you have, which can be the only data point signaling they might have insights you don’t.

Simplicity feels like an easy walk. Complexity feels like a mental marathon.

Here’s a common theme in the way people think: Wounds heal, but scars last.

people who’ve had different experiences than you will think differently than you do. They’ll have different goals, outlooks, wishes, and values. So most debates are not actual disagreements; they’re people with different experiences talking over each other.

People tend to have short memories. Most of the time they can forget about bad experiences and fail to heed lessons previously learned. But hard-core stress leaves a scar.