#702: Morgan Housel — Contrarian Money and Writing Advice, Three Simple Goals to Guide Your Life, Journaling Prompts, Choosing the Right Game to Play, Must-Read Books, and More | Science vs

Intro

In this episode of the “Science vs” podcast, host Wendy Zukerman interviews Morgan Housel, a writer and investor, about contrarian money and writing advice, three simple goals to guide your life, journaling prompts, choosing the right game to play, must-read books, and more. Housel shares his insights on predicting the future, the importance of good writing, the impact of wealth on personal relationships, and the value of giving money to children when they need it most. Join Zukerman and Housel as they delve into these fascinating topics and provide valuable advice for listeners.

Main Takeaways

Betting on the Unchanging

• Warren Buffett’s success comes from betting on things that stay the same forever.
• People are bad at predicting the future because they focus on what’s going to change instead of what’s not going to change.
• Focusing on parts of human behavior that have never changed allows for a better understanding of the future.
• Our ability to predict how people will respond to greed and fear is reliable because it’s never changed.
• One should focus on what would be true in 999 out of 1000 iterations of their life.

The Art of Writing

• Good writing is easy, bad writing is hard.
• Only write a book if you have to do it.
• Choose to write when the idea is fresh and spilling out of you.
• Focus on what you can predict with certainty, and separate it from what you cannot.
• Applying the serenity prayer through the lens of human nature over time can reduce anxiety.
• Movement is critical to forming new thoughts and moving the writing process along.
• Writing can be a process of throwing ideas onto the page and going for walks to reflect on them.

Wealth and Relationships

• “Social debt” is the obligation to help family and friends financially when one becomes wealthy, which can lead to financial ruin.
• Athletes have a high rate of going bankrupt due to social debt, not just extravagant personal spending.
• The Vanderbilt family’s immense wealth made their descendants miserable.
• A wealthy family worked hard to raise well-balanced children who were not treated differently.
• People treat you differently when they want something from you, which can be harmful.
• An ethical company made the wealthy family’s fortune.
• The family intentionally lived anonymously and did not attend fundraisers or galas.
• Babying children can hinder their development and growth.
• Parents with high net worth may prioritize protecting their wealth over philanthropy.
• Giving children money when they need it in their 30s and 40s can be more beneficial than waiting until death.

The Impact of Money

• If you are already happy, gaining more money will probably make you happier, but if you’re already kind of depressed, gaining more money is probably not going to help that much.
• Money didn’t help J Paul Getty, the richest man in the world, because he was already depressed.
• Money can buy contentment, but not happiness.

Insights on Life and Success

• Life is incredibly fragile, and small decisions can have huge impacts.
• Risk is what’s left when you’ve thought of everything else.
• It’s important to ask questions about what we’re ignoring and what else is out there that we’re oblivious to.
• Our experiences in life are unique, and it’s important to recognize that.
• Constantly interrogating the past and contemplating the future can be an unhealthy mindset.
• It’s impossible to predict the future, but some outcomes may seem obvious in hindsight.

Summary

Betting on the Unchanging

Morgan Housel emphasizes the importance of focusing on what remains constant in human behavior when predicting the future. By understanding how people respond to greed and fear, one can make more reliable predictions. Housel suggests that individuals should focus on what would be true in the majority of iterations of their life, rather than getting caught up in short-term trends.

The Art of Writing

Housel shares insights into the process of writing, emphasizing the importance of good writing and the need to write only when the idea is fresh and overflowing. He encourages writers to focus on what they can predict with certainty and to separate it from what is uncertain. Housel also highlights the value of movement in the writing process and the benefits of throwing ideas onto the page and reflecting on them during walks.

Wealth and Relationships

Examining the impact of wealth on relationships, Housel discusses the concept of “social debt” and its potential to lead to financial ruin. He explores the experiences of wealthy families, highlighting the negative effects of being treated differently and the importance of raising well-balanced children. Housel also suggests that giving children money when they need it in their 30s and 40s can be more beneficial than waiting until death.

The Impact of Money

Housel explores the relationship between money and happiness, noting that while money can buy contentment, it does not guarantee happiness. He shares examples of individuals who were already depressed despite their immense wealth, highlighting the importance of addressing underlying emotional well-being. Housel suggests that the impact of money on happiness may depend on an individual’s pre-existing state of happiness or depression.

Insights on Life and Success

Housel provides insights on life and success, emphasizing the fragility of life and the potential impact of small decisions. He encourages individuals to consider what they may be ignoring and to question their assumptions. Housel also advises against constantly interrogating the past or fixating on the future, suggesting that such mindsets can be unhealthy. While the future is unpredictable, Housel notes that some outcomes may seem obvious in hindsight.

Conclusion

In this thought-provoking episode, Morgan Housel shares valuable insights on predicting the future, the art of writing, the impact of wealth on relationships, and the role of money in happiness. He encourages listeners to focus on what remains constant in human behavior, to prioritize good writing, and to consider the potential consequences of wealth. Housel’s perspectives on life and success remind us to appreciate the fragility of life and to question our assumptions. Tune in to gain a deeper understanding of these fascinating topics and gain valuable advice for navigating life’s complexities.