Friends,
I saw a tweet from @theSamParr that hit home.
There are many dimensions to us all but our sorting minds love a good ol’ duality. The tweet conjured the “thinker-doer” dichotomy. I place myself on the thinker end of the spectrum.
Pangfully.
I explained this insecurity on the 1 year anniversary of this newsletter:
Life feels best for me when I’m in a flow. Building. Producing not just consuming. And if this experiment taught me anything, it’s to introspect a bit less. Have more of a bias towards action. This isn’t my default. I’d say shoegazing was more my thing (I won’t lie, I do dig Jesus and Mary Chain). To people who are naturally wired for action, like Yinh who many of you know is a first-ballot Hall of Famer at getting sh%t done, this sounds obvious. Subeasy even. But I know I’m not alone. I know from conversations with many readers who are struggling with inertia.
My buddy @darjohn25 response to the tweet echoed my own feelings:
This of course reminds me of the quote:
Everybody is a genius. But if you judge a fish by its ability to climb a tree, it will live its whole life believing that it is stupid.
If you are struggling to be a do-er, if that “reductionist” tweet put you on the defensive, let me first offer a forgiving perspective.
You Are Not A Profile Bio
My mom has been visiting for the past few weeks and we have been taking a walk together every morning. We were discussing how she felt lost for 3 years after she retired. She missed structure. She felt useless. Self-doubt was replacing self-worth.
I challenged her.
Did she realize how much utilitarian religion she had internalized? If your self-worth is tied to legible output you are on shaky ground. You are a small logical leap to “people who do more are worth more”. It’s an equally small leap in the other direction to victim-blaming. The philosophy fails the test of universality. What is the value of severely challenged, handicapped, or sick people in that framework? Even if we extend the framework to the gap between what you have done and what you are capable of, is that any better a foundation? You might as well look at your naked self in the mirror and score your life based on your eating choices.
These outside perspectives are worth a look:
- The Truth About My Son (YouTube)
Mark Rober - The Danger Of Tying Your Self-Worth To Your Net-Worth (Link)
Khe Hy - Your Money Says Too Much about You (Link)
Moontower
Punting The “Why”
My mom’s problem disguised itself as “what should I be doing?” when it’s really a “why do we do anything?” I wasn’t being hard on my mother. I was pointing out how merciless she was to herself. Workism is wasted piety. I feel bad saying that the foundation of “work equals value” is shaky without offering an alternative. I suspect we all have to create our own meaning. And my mom admits she never explicitly recognized the script that was guiding her. If you haven’t identified your own, I’ll give you a hint: your insecurities reveal your religion.
Returning to my thoughts from 1 Year of Moontower:
There are people of all ages searching for what they are good at. What they should be doing. People that don’t know their strengths. They are curious and eager but don’t know how to direct their energy. The prescription for all of them is to just take a small step and do something. If you want to get fit, don’t wait until you buy the running sneakers you think you need. Just do a few pushups right this second. The action muscle needs to be trained. I’m working on it too. Readers, if you fall in this camp and you hang with me every week in this letter, I’d bet you have a lot to give inside you. But you can’t introspect it out. You have to take a step. And you need to continue. Like a dumb mule. Forward. Why? “Why” is a shoegazing question. Drop it. The why will come to you later. The only formula that matters today is effort x reps equals something big. If you multiply either by zero, you get zero.
In other words, I don’t have an answer for the “why”. I just know that it’s not necessary to confuse “what you are doing” as your “why”.
I’d have more luck holding my breath to scuba dive than coming up with answers to life’s meaning, So next week I’ll target an easier meta-question: “what should you be doing?”. Just as we don’t need to confuse our “what” with our “why”, I think we can figure out what we should be doing without a “why”. Darrin’s “talent/interest mismatch” is a clue.
The Money Angle
Understanding Returns
@10kdiver asks:
Imagine we have 2 businesses, S and F.
S is a Slow Growth business. Its earnings grow at 6% per year. F is a (relatively) Fast Growth business.
Its earnings grow at 9% per year. Both businesses are trading at 15 times earnings.
Which is the better investment?
The answer depends on how much capital it takes to create the earnings. This thread is an easy-to-follow explanation of a critical investing concept.
Questions About Managing Tail Options In Your Book
These are copy/paste replies to a friend who asked my opinion on options.
- What do you think about “hard” vs “soft” deltas? I.e treating your otm deltas differently than your atm or itm deltas. Specifically not delta hedging when you buy otm wings?
My response:
Depending on the name and how the skew behaves I’d say my experience in normal conditions is OTM options have lower deltas than the model predicts. The prices are “sticky”. So if I’m running a book long lots of OTM options I’m going to lean my delta in that direction.
- What about if you get long vs short those wings? Would you treat the delta differently depending on that?
My response:
You can’t hedge a wing short with anything but other options so it would depend on the option hedge. In general, I don’t open selling wings just because they are “high”. I will sell expensive wings closing. Also, there’s asymmetry with respect to how you ended up with a wing position. Typically you can get long them at reasonable levels because they are the leg of a spread that’s popular in some market. For example, in oil markets, when producers buy put spreads they are handing you the wings. Yummy.
In general, the only way I end up short wings outright is if the underlying makes a huge move through [for example] a short call spread, blowing thru both call options. Well, now I’m synthetically long a put spread and therefore short the left tail.
Last Call
I decided to create a public Notion page that indexes posts by others which have been deeply influential or at least stand tall in my mind. It’s not exhaustive, since I can’t remember each one of them easily. But when I cross paths with them again, I now have a handy place to add them.
You can find the index here:
Moontower’s Favorite Posts By Others
While creating this the shortcoming of a chronologically-ordered blog became obvious. So I have also created an index of all the writing I’ve done publically.
Find that below:
From my actual life
- We got a sitter Friday night and went to a dive bar (Retro Junkie in Walnut Creek). Fireball was involved.
- I joked on Twitter about the need for some overfunded startup to tackle the scheduling Tetris that comes with trying to book summer camps. Since nobody responded with “bitcoin fixes this” I presume it’s hopeless.
- Maxen turns 5 today. Here’s to hoping the super-soaker event doesn’t turn into a super-spreader event.
When Zak turned 5 I wrote him a long letter that I will give him when he moves out one day. I’ve been thinking about what I’m going to write for Max lately. The nurses in the maternity ward warned us. The way he screamed when he was hungry was unusually intense based on the sample they had seen in SF baby factory known as CPMC.
Max is brooding and extremely hot-blooded. Nothing like his older brother or his parents. He keeps us all on our toes. He’s the family clown. He’s also the one to grab you around the neck at random, kiss you on the lips, and declare his love to you. I used the Chris Joke last year on Max’s birthday…I don’t know if we are saving college money or bail money.
5 years ago:
More recently:
