On Risk
Thoughts
An interesting quote from Sam Altman that’s on my mind is he says that, in general, people are too risk-averse. More specifically, people overweigh short-term catastrophic risk while not thinking enough about long-term chronic risk.
It makes sense we are wired this way, after all, in hunter-gatherer times, genuine catastrophic risks were probably abound. From starvation to deadly predators, but it means we are not optimally programmed by default to navigate modern-day society.
I was invited to my friend’s wedding this week, who I’ve known for over 20 years. Naturally, there was a lot of catching up about what everyone is up to, what xyz is doing for work etc. And it made me think about the quote again, because without fail, every single one of my old school and uni classmates who took risks and unconventional paths were doing just as well as the doctors and consultants.
Everyone who took the unconventional path chose it on their own terms.
So I agree with Sam that the vast majority of us do not take enough risks. There are extreme cases, for example illegal things or something that would put you in immediate physical danger are genuinely too risky. If it’s not permanent, humans are extremely adaptable. Looking back over my life with hindsight, every time there's been a close decision and I took the ‘safe’ option, I’ve regretted it.
The earliest story of the top of my head I can remember was when I joined my 6th form grammar school, having spent my high school years in a very low-performing school. I was very determined to do well and set myself up for uni. It got to the point where I had to pick my A-Level subjects, and it was a choice between English Lit, which I was really passionate about and Chemistry, which I didn’t particularly enjoy.
I ended up having a long chat about it with my would be English Lit teacher, he told me what we’d be studying, how he saw my potential and how I would be an asset to the class. I knew I would enjoy it, and get on with the teacher but was worried that I might not get a good grade.
I said, 'Sir, it's too difficult, can you tell me what to do? I'll do what you say'
He said 'Hans, I can't make that call for you, you have to be a man and take responsibility for your choices. I have confidence you'll make the right decision'.
I ended up chickening out and going for the ‘safe’ option by picking Chemistry. Because in my 17-18 year old head, getting an A was more straightforward since it’s a science and it’s just facts, whereas there’s uncertainty with English Lit.
What actually ended up happening was I got shouted at for most of my Chemistry lessons because I couldn’t get the hang of it, I still remember the utter look of disappointment on Mr Moran’s face when I tried to answer his question about 1s2 2s2, the way he’d bury his head in his hands. It culminated in me walking out of the final exam and averaged a D. So the not so 'safe' after all.
There are so many instances of this through my life and as time has passed the stakes are higher too.
For me, the most important thing I've learnt is to be an independent thinker. There’s so much noise, on the news, on social media, people forcing their views and opinions on you, it’s key to think from first principles, what is important to you.
It’s a crazy world we live in, a lot of the traditional rules don’t apply. Even just a short 5 years ago, who would have thought we would have AI at our fingertips writing code, and people would be talking to AI for therapy.
Any stories you're willing to share? Hit reply!
What I’m Reading
“Six Easy Pieces: Essentials of Physics Explained by Its Most Brilliant
Charlie Munger (former vice chairman of Berkshire Hathaway) said something along the lines of: to the man with a hammer, every problem looks like a nail. He was referring to how we are encouraged to think in a tunnel vision kind of way, according to our profession, for example, an entrepreneur, psychologist, lawyer or physicist would approach the same problem differently according to their training. And depending on the situation, one mental framework might be more suitable. He encourages us to understand the basic philosophy of other disciplines which will yield disproportionate benefits.
So I’m broadening my reading from finance/economics books and reading “Six Easy Pieces: Essentials of Physics Explained by Its Most Brilliant Teacher”. It’s by Richard Feynman, and it’s one of those must-read books for anyone with even a passing interest in Physics. It’s written in a super approachable way with minimal jargon and no prior knowledge required, touches on some of the biggest topics in Physics. Very thought-provoking.
Resource of the week
This week, the Google Chrome browser finally banned adblockers, so I’ve switched over to Firefox.
Quote
What can you do to break out?
Four things: First, realize that you are surrounded by prison walls, that your mind has gone to sleep.
It does not even occur to most people to see this, so they live and die as prison inmates. Most people end up being conformists; they adapt to prison life.
A few become reformers; they fight for better living conditions in the prison, better lighting, better ventilation. Hardly anyone becomes a rebel, a revolutionary who breaks down the prison walls. You can only be a revolutionary when you see the prison walls in the first place.
Anthony De Mello-The Way to Love
Hans