23 Ideas from 2023 – Safal Niveshak

Right before the year ends, I thought I’d share a handful of ideas I’ve read, learned, re-learned, and wrote about in the past twelve months. Here are 23 of them, in no particular order of importance. I hope you find these useful, as much as I did.

1. Investing is Simple, Not Easy

This is the stock price chart of Titan Company over the past 16 years (2007-2023) –

Our brain that works with perfection in hindsight would lead us to believe that buying and holding the stock during these 16 years would have been an easy choice for anyone who did it. After all, the only thing the investor would have done during these 16 years was, well, nothing.

I wish investing was that easy.

Of course, the idea of buying and holding high-quality businesses over a long period of time is simple. Everyone knows that, and even those who do not practice it appreciate that this works with most high-quality businesses, as history has proven time and again.

But then, it is important to understand that the action of ‘not doing anything’ over such a long period of time involves hundreds of decisions over months and years that lead to such inaction.

Businesses change from time to time, and so do emotions, and so does the behaviour of other investors around us, and so do conditions in the stock market and of our portfolios. And that’s why sitting on stocks – the ones that remain high quality – is not as simple as it sounds. And that’s why patience is one of the most important yet difficult skills one must cultivate while investing in the stock market.

George Baker makes a powerful remark which Thomas Phelps quotes in his book 100 to 1 in the Stock Market – “To make money in stocks you must have “the vision to see them, the courage to buy them and the patience to hold them.”

Patience is the rarest of the three, and is not an easy skill to develop however easy experienced investors or advisors may make it sound. But if developed and practiced well, it pays off well in the long run. That’s how fortunes are made in the stock market.

Just be prepared for the grind. And stick with quality until it remains quality. Because if it is not quality, buy-and-hold will not help you create wealth, but destroy it. Like here –

2. Long Term Investing is Hard

Long term investing demands a virtue that’s in short supply these days: and that is patience. It’s like planting a seed and waiting for the tree to grow. In a world where everyone’s racing against the clock, embracing the waiting game can feel downright painful.

Let’s also consider that the average lifespan of businesses and their competitive advantages is on the decline. It’s like the sand slipping through the hourglass faster than ever. Add to that our shrinking attention spans and holding periods – it’s a challenge to stay committed for the long haul.

Look at some data from the stock market. As per the New York Stock Exchange Factbook, the average holding period for stocks in 1960 was 100 months (8 years). By 1970 it had dropped to 63 months (5 years). By 1980 it had dropped to 33 months, by 1990 to 26 months, by 2000 to just 14 months, and in 2010 just six months.

Even in India, when I look around to see what most people in the stock market are doing, I see them considering two-three months of holding stocks as painfully long.

I met a gentleman in one of my investing workshops who told me how he held on to his “high conviction” idea for five months, before losing patience as the stock market crashed and so did his stock. Then there was another gentleman I met who had been “playing” the stock market for the past fifteen years, but has never held a stock more than six months. He told me with pride how he took concentrated bets and then book profits or losses in under six months. Beyond that was, like, painful for him.

How much ever I wish more people would invest sensibly and for the long run, and whatever I want to drill into their minds through my posts, courses, and workshops, I deeply believe it’s a permanent change.

I can see no influence that would revive most people’s interest in holding stocks and mutual funds through times of trouble. Sure, the number of people who believe they would practice long term investing even through bad times has increased over the years. But most of such people just need one extended bad market to shake their belief.

Given this landscape, long term investing becomes this rare, contrarian endeavor. It’s not for the faint of heart. I do not see many investors having the grit or the insight to weather the storm.

In fact, a significant chunk of people in the stock market are sailing without a compass. When the money starts flowing in effortlessly, it’s easy to get caught up in the frenzy. But here’s the catch – quick wins can often be like a wolf in sheep’s clothing, leading unsuspecting investors to the proverbial slaughterhouse.

And therein lies the key point of my idea. In a world where everyone’s looking for the next big thing, if you can resist the allure of instant gratification, you can do really well for yourself over the long run as far as wealth creation and wealth preservation is concerned.

I’ve been in the investing game for over 20 years, practicing long term investing with sincerity and decent success based on my own standards. I’ve seen a lot of fellow investors drop out, regretting their decisions. It’s a proof of the power of this idea.

Sure, long term investing is tough. But trust me, if you can navigate the challenges with extreme patience, the rewards are absolutely worth it.

3. Charlie Munger Lives on as All Great Philosophers Do

It’s a natural human tendency to seek comfort in the belief that certain scenarios are beyond the realm of possibility. Whether it’s a health issue, or a personal tragedy, we often tell ourselves, “That could never happen.” We build mental fortresses around these notions, finding solace in the illusion of invincibility.

But life has a way of humbling us, showing us that no one is exempt from its capriciousness.

28th November 2023 was one such day.

Charlie Munger, whom I have considered a hero in my life, passed away at the age of 99, just 34 days from turning 100.

And Charlie is not just a hero for me on paper. He has been, and always will be a guiding force in my life, shaping my values, decisions, and aspirations. His wisdom has been my compass, and his principles are sort of my North Star.

As I come to terms with his passing, I celebrate the incredible legacy he leaves behind. The impact he had on my life and the lives of countless others is a testament to his extraordinary character and the enduring power of his words.

Here are a few beautiful quotes from Charlie on how to be happy in life and survive a long time to tell the tale.

If all you succeed in doing in life is getting rich by buying little pieces of paper, it’s a failed life. Life is more than being shrewd in wealth accumulation.

Remember that reputation and integrity are your most valuable assets – and can be lost in a heartbeat.

A lot of success in life and business comes from knowing what you want to avoid: early death, a bad marriage etc.

Envy is a really stupid sin because it’s the only one you could never possibly have any fun at. There’s a lot of pain and no fun. Why would you want to get on that trolley?

Confucius said that real knowledge is knowing the extent of one’s ignorance. Aristotle and Socrates said the same thing. Is it a skill that can be taught or learned? It probably can, if you have enough of a stake riding on the outcome.

Some people are extraordinarily good at knowing the limits of their knowledge, because they have to be. Think of somebody who’s been a professional tightrope walker for 20 years – and has survived. He couldn’t survive as a tightrope walker for 20 years unless he knows exactly what he knows and what he doesn’t know. He’s worked so hard at it, because he knows if he gets it wrong he won’t survive. The survivors know.

Knowing what you don’t know is more useful than being brilliant.

Finally, as Charlie would have said, “I have nothing to add.”

Will miss you, Charlie! 🙁

4. The Charlie Munger Manifesto

“We have a passion for keeping things simple,” Charlie Munger would often say.

And taking a leaf out of that, I have created The Charlie Munger Manifesto, which contains his most important rules for living a good life, and avoiding bad outcomes.

These rules are something you can reflect back on, like I have done, if you ever feel stuck in your life.

And if you believe in them, follow them, and stand for them, your life will be good.

Click here to download the manifesto in high resolution.

5. The Charlie Munger Investing Manifesto

Close on the heels of The Charlie Munger Manifesto, which contains his most important rules for living a good life, and avoiding bad outcomes, here is The Charlie Munger ‘Investing’ Manifesto, which lays down some of his most profound ideas on becoming a wiser investor.

Click here to download the manifesto in high resolution.

6. Stock Investing is a Humbling Game

Not losing money is a critical part of the stock investing process. Successful investors say it in different ways, but the point is always the same.

Warren Buffett has often said – “Rule No. 1: Never lose money. Rule No. 2: Never forget rule No. 1.”

But he has also said – “If you don’t make mistakes, you can’t make decisions.”

You see, the problem is not in making mistakes. The problem is in not knowing when you have made a mistake and thus not learning from it.

Unfortunately, openness to making mistakes and recognizing them is beyond most of us. Why is that?

Two reasons. The first, our society’s phobia for making mistakes, something that begins at school, where we learn to learn what we are taught rather than to resolve problems. We are fed with facts, and those who make the fewest mistakes are considered to be the smarter ones. So we learn that it is embarrassing to not know and to make mistakes. We feel bad when we find out we have made a mistake or do not know something.

The second reason we find it hard to recognize mistakes is our focus on outcome rather than process. We prefer the “right” result from the wrong decision to a “wrong” result from the right decision, labeling everything that does not “work out” a mistake.

In doing so, we fail to differentiate between those investors who are unaware of the inconsistency between their thoughts and actions and those who merely come to a wrong decision.

If you have read the story of Socrates’ trial and execution and what the classical Greek philosopher taught the world about humility, you know that humility is, in fact, one of the greatest assets for any person, including a stock market investor.

Practicing humility gives you the strength to fail forward. The only mistake you do not want to make is forgetting your mistakes. Ignoring the mistakes can make you lose the golden opportunity to use them as stepping stone for accumulating real wisdom.

My investing career of 19+ years has been a big bagful of mistakes, some stupid and humiliating, and the rest very stupid and very humiliating.

I have bought stocks with poor fundamentals just because they were trading cheap (Arvind), stocks without understanding their underlying businesses well (Hotel Leela), sold good stocks too early just because I was scared of losing my paper profits (Page Industries), avoided good businesses just because their stock prices were slightly higher than my ‘comfortable’ buying prices (Asian Paints), and sold good businesses whose stock prices did not seem to move for 2-3 years (Swaraj Engines).

Oh, the list is longer, but let me not embarrass myself too much at one go! 🙂

However, thankfully, my mistakes have not deterred me from working on my investment process, to improve in such a way that I avoid repeating my mistakes from the past. And that has helped me earn a satisfactory return on my investments over the past few years.

According to Peter Lynch, in investing, you are doing great if only 60% of your calls turn out to be right, so it is important to acknowledge that you will make mistakes.

Reminds me of this anecdote about Henry Ford, the father of automobile industry. Once, he was being interviewed by a friendly journalist. On being asked his secret for success, he said, “I have two words for you Sir. Good decisions.”

“And how did you learn to make good decisions?” asked the journalist curiously.

“Two words again – Bad decisions.” Ford replied. He intuitively understood the importance of learning from bad decisions.

Knowing that you do not know a lot of things, knowing that you will make a lot of mistakes, and knowing that you will be crucified for your mistakes, and accepting these as part of the journey, is what causes success in investing.

The stock market, Ken Fisher says, is a “great humiliator.” The best way to deal well with it is to play the game with complete humility, because that is the way you will help yourself from not getting humiliated too badly or too often.

That is the way this game works in your favour.

You play it this way, or you don’t.

7. Dare to Be Wrong

“Dare to be wrong,” Howard Marks wrote in one of his memos in 2014, very much like Charlie Munger told him, “It (investing) is not supposed to be easy. Anyone who finds it easy is stupid.”

Marks wrote –

You have to give yourself a chance to fail.” That’s what Kenny “The Jet” Smith said on TV the other night during the NCAA college basketball tournament, talking about a star player who started out cold and as a result attempted too few shots in a game his team lost. It’s a great way to make the point.

Failure isn’t anyone’s goal, of course, but rather an inescapable potential consequence of trying to do really well.

He then added –

Any attempt to compile superior investment results has to entail acceptance of the possibility of being wrong.

…since conventional behavior is sure to produce average performance, people who want to be above average can’t expect to get there by engaging in conventional behavior.

Their behavior has to be different. And in the course of trying to be different and better, they have to bear the risk of being different and worse. That truth is simply unarguable. There is no way to strive for the former that doesn’t require bearing the risk of the latter.

Of course, as Marks wrote, it’s important to play judiciously, to have more successes than failures, and to make more on your successes than you lose on your failures. But it’s crippling to have to avoid all failures, and insisting on doing so can’t be a winning strategy.

Such a strategy may guarantee you against losses, but it’s likely to guarantee you against gains as well.

I have seen so many people over the years who have sat on the stock market’s sidelines – either due to fear of losing money, or while waiting for a perfect opportunity to buy stocks – that they have paid huge opportunity costs of not being invested.

No one wants to look wrong now when everyone else is looking Mr. or Mrs. Right.

In his memo, Marks quoted Lou Brock, one of baseball’s best players of the late 1960s, as saying –

Show me a guy who’s afraid to look bad, and I’ll show you a guy you can beat every time.

The interesting part about the stock market is that wherever you look, you would find such guys aplenty – people who are afraid to look bad, and thus people who do things that everyone else is doing.

Anyways, here is how Marks ended his memo –

Unconventional behavior is the only road to superior investment results, but it isn’t for everyone. In addition to superior skill, successful investing requires the ability to look wrong for a while and survive some mistakes.

Thus each person has to assess whether he’s temperamentally equipped to do these things and whether his circumstances will allow it…when the chips are down and the early going makes him look wrong, as it invariably will.

Not everyone can answer these questions in the affirmative. It’s those who believe they can that should take a chance on being great.

Mark these words, and note them in your investment journal – Successful investing requires the ability to look wrong for a while and survive some mistakes.

But then, are you willing to bear the embarrassment of looking wrong when all others around you are looking right?

“Love all, trust a few, do wrong to none,” said William Shakespeare.

Vishal Khandelwal writes, “In the stock market, trust few (businesses), love even fewer, but don’t fear doing wrong.” 😉

8. Path Dependence: A Lesson for New Investors

I was going through a few of my journal notes and came across this thought from Nassim Taleb who explained the concept of “path dependence,” which is the dependence of outcomes on the path of previous outcomes, rather than simply on current conditions –

Ironing your shirts then putting them in the washing machine produces a different outcome from washing your shirts first, then ironing them. The reader can either trust me on this, or try the experiment with both sequences on the next Sunday afternoon. Now, assume that your capital is around one million dollars and you are involved in speculation. Apply path dependence to the reasoning. Making a million dollars first, then losing it, is markedly different from losing a million dollars first then making it.

The first path (make-lose) leaves you intact; the second (lose) makes you bankrupt, insolvent, maimed, traumatized and more generally unable to stay in the game, thus unable to benefit from the second part of the sequence. There is no make after the lose.

This note from Taleb reminded me of Warren Buffett’s “Rule No. 1 – Never LOSE money.”

Consider a weak, fragile business. It is path-dependent. With stretched balance sheet, large capital requirement, and inadequate capacity to suffer, a prolonged weakness in the economy can destroy it. It is then difficult for it to rise from that ruin. When you own such a business, you have to do a lot of praying to the economics gods. Such a business starts from a “lose” and now it’s difficult, almost impossible, for it to “make” back what it lost.

On the other hand, a robust and anti-fragile business, with clean balance sheet and low capital requirement, which has built a capacity to suffer over years, is not path dependent. It can survive a weak economy. Even if the weakness persists, at worst, it may lose what it has already made, which is better than starting with losing it all.

So, check out what you already own in your portfolio. Is it in the “make, then lose” category, or “lose, then lose everything” one?

Stick with the former. Discard the latter.

9. Embracing Simplicity in a Complex World

10. 10 Qualities of Great Investors

One of the first lessons I learned from my yoga teacher was that “yoga is not about rapid movements but long pauses. Slow down, calm down, don’t hurry, and trust the process.”

The thing about yoga — or any exercise — is that there isn’t a comfort zone. But if you have a sound process, and practice it diligently, over time it starts to work for you.

The act of investing your money, as I realize, isn’t much different from practicing yoga. A superior process and greatness often go hand in hand in yoga, and also in investing. For serious investors, thus, it’s wise to learn to trust the process that generates winning investment results.

I came across one such time-tested process framework while reading Michael Mauboussin’s “Reflections on the Ten Attributes of Great Investors.” Mauboussin is Head of Consilient Research at Counterpoint Global, Morgan Stanley Investment Management, and author of some amazing books like The Success Equation and More Than You Know. He is a highly successful value investor, and thus the process he has laid out in his note is a great help for any serious investor seeking a winning investment process.

Click here to read my thoughts on the ten attributes Mauboussin has laid out in his note.

11. Stock Market + Entertainment = Disaster

In investing, as you seek (entertainment), so shall you receive (disaster). Seek what’s good for your in the long run, not what makes you ‘feel’ good in the short run.

12. Investing’s Few Eternal Truths

In Howard Marks’s memo just after the dotcom bust in 2000, which was titled – We’re Not in 1999 Anymore, he laid down here a few eternal truths of investing that have stood the test of time, and continue to do so.

I write about those truths in this post.

If you can practice these as part of your investment process – it’s not easy, you see – you can aim for some success over the long run.

13. Just Keep Learning

I have lived with and suffered through several prejudices over the years, which were dispelled one after the other as I walked on my journey of lifelong learning.

Every time I started believing I know how the world was, the world showed me more and more ways in which I was wrong.

I learned that I was wrong about what things are.

I learned that I was wrong about how things work.

I learned that I was wrong about who people are.

I started my investing career believing –

• what Gordon Gekko said in the movie Wall Street, “I don’t throw darts at a board. I bet on sure things.”
• that greed was indeed good,
• that stocks were blips on the ticker,
• that the only thing that could help me succeed as an investor was my skill in stock picking, and
• that making money from stocks required me to just be rational in my analysis.

These prejudices were gradually removed as I read and learned from Graham, Buffett, Munger, Fisher, Taleb, etc. –

• that there are no certainties in investing, only uncertainties,
• that greed is not good for an investor, and so are fear and envy,
• that stocks were representative of businesses and that to do well, I must think and act like a business owner,
• that investing is largely a game of luck, and that skill shines through only in the long run, and
• that making money from stocks required much more than rational analysis and a great control on my emotions and behaviour.

After 20 years of being an investor and learner, I still have my prejudices and continue to look at the world with my own tinted glasses. And I am sure that will continue till I have my thinking faculties working intact (for it’s our prejudices that make us humans).

But as I continue my learning journey and keep unburdening myself with parts of my ego and blind spots, I also believe that I may see a greater light coming from the end of the tunnel of my ignorance.

I may get less prejudiced, I believe.

My life and thinking may get better, I believe.

And if you are like me, I believe the same for you too.

Just keep learning.

14. What Nobody Told You About Financial Freedom

I recently read Matt Haig’s book Reasons to Stay Alive. Here is an excerpt, which instantly touched a chord –

“The world is increasingly designed to depress us. Happiness isn’t very good for the economy. If we were happy with what we had, why would we need more? How do you sell an anti-ageing moisturiser? You make someone worry about ageing. How do you get people to vote for a political party? You make them worry about immigration. How do you get them to buy insurance? By making them worry about everything. How do you get them to have plastic surgery? By highlighting their physical flaws. How do you get them to watch a TV show? By making them worry about missing out. How do you get them to buy a new smartphone? By making them feel like they are being left behind. To be calm becomes a kind of revolutionary act. To be happy with your own non-upgraded existence. To be comfortable with our messy, human selves, would not be good for business.”

Investing is not away from the reality Haig has talked about in his book. The things we hear or read in business media, or what we hear most advisors and experts speak, are designed to depress us. Happiness (of their customers and prospects) is not very good for relationship managers peddling their toxic financial products.

We are sold insurance policies, mutual funds, and stock ideas as if our lives depended on them. And that if we do not buy those products, we would end up in a bad financial situation and despair, even as our friends and all those friends we know on Twitter and Facebook would get rich.

People are led to make financial plans for 20-30 years ahead, while not many are taught to deal in the present with the behavioral aspects of taking care of their money, like simplicity, frugality, and patience.

Financial freedom remains a subject tied only to money and not to the peace that no amount of money or wealth would get us, but which is a subject matter of the understanding within, of course, along with enough money.

The fact is that the more we think that a lot of money is what we need to live happily, and the more we associate money with most things in life, the more we convince ourselves that we are too poor to buy our freedom.

But this is what the world is increasingly designed to do to us – always create that fear, urge, and urgency to go for more, even when we have more than enough.

However, like Haig adds to the above note – “Yet we have no other world to live in. And actually, when we really look closely, the world of stuff and advertising is not really life. Life is the other stuff. Life is what is left when you take all that crap away, or at least ignore it for a while.”

Practice this in investing too, and you will be at great peace always. Take all that crap away – unwanted noise, advice, and financial products – and stick with what is the bare minimum, including the idea of having enough money and that’s it.

You will not then have to wait for your financial freedom in the future, for the worry about having a lot of money will disappear right away, and you will start feeling grateful for what you have right now – adequate food, safe shelter, and the company of your loved ones.

That world won’t depress you, believe me.

15. How “Wealthy” Are You?

16. Life’s Most Important Decision

“The biggest decision of your life will be who you choose to marry,” said Warren Buffett in a documentary. “There have been two turning points in my life,” he added, “One when I came out of the womb and one when I met Susie. What happened with me would not have happened without her.”

He addressed the topic during a 2017 conversation with Bill Gates at Columbia University, too –

You want to associate with people who are the kind of person you’d like to be. You’ll move in that direction. And the most important person by far in that respect is your spouse. I can’t overemphasize how important that is.

After spending 20 years with Vidhi, I too can’t overemphasize how lucky I’ve been having her as my partner for life. She has been my pillar of strength all these years, and the main reason that I am where I am and who I am today. And whenever I have hit bumps along the road, she has helped me get through.

So how big and overwhelming a deal is to pick the right spouse? Tim Urban writes in his blog Wait But Why –

…start by subtracting your age from 90. If you live a long life, that is about the number of years you are going to spend with your current or future life partner, give or take a few…And when you choose a life partner, you are choosing a lot of things, including your parenting partner, someone who will deeply influence your children, your eating companion for about 20,000 meals, your travel companion for about 100 vacations, your primary leisure time and retirement friend, your career therapist, and someone whose day you will hear about 18,000 times.

As a culture, we spend hours upon hours developing academic knowledge, building physical fitness, deciding where to go to college or learning about managing our money well. But we spend little time, if any, finding out how to make the most important decision of our lives. Because that is what it is.

Your choice of life partner will affect the quality of your life much more than where you go to college, what you do for a living or where you make your home. Choosing a good spouse is by far the most important thing in life to get right.

And the best way to get a good spouse, Charlie Munger advises, “is to deserve a good spouse.”

17. How to Recover from Reverses in Life and Investing

When a shareholder asked him in the 2013 AGM of Daily Journal Corp how does one recover from the reverses in investing and not dwell much on them, Charlie Munger replied –

You know what Rudyard Kipling said? Treat those two imposters just the same success and failure. Of course, there’s going to be some failure in making the correct decisions. Nobody bats a thousand. I think it’s important to review your past stupidities so you are less likely to repeat them, but I’m not gnashing my teeth over it or suffering or enduring it. I regard it as perfectly normal to fail and make bad decisions. I think the tragedy in life is to be so timid that you don’t play hard enough so you have some reverses.

If there is one big lesson we can take from Charlie’s life, apart from the one on being a learning machine, it is that we must pick ourselves up after every meltdown we suffer (in investing included). We must also know that all our struggles and all our failures will lead us to experience something greater and lead us to be someone better.

Then let’s begin all over again. And find the courage to stand up, and face today with just as much hope as we had yesterday.

18. Advice to a Young Adult

Here’s something I advised a college student recently, who was ruing not knowing where she was headed in life, even as she thought all her friends were sure about where they were headed –

1/ Life is an unpredictable journey, and sometimes, not knowing where you are going is fine.

2/ Embracing the unknown allows us to be more open to spontaneity. When we don’t have a rigid plan, we can say “yes” to unexpected adventures, meet new people, and stumble upon incredible experiences that we wouldn’t have anticipated otherwise.

3/ Not knowing where you’re going can also reduce the pressure to meet certain expectations, especially other people’s. You’re not bound by a predefined path, so you have the freedom to explore your passions, try new things, and find what truly makes you happy.

4/ Uncertainty fosters creativity. When you’re not locked into a specific goal, you’re free to experiment, take risks, and think outside the box. Some of the world’s most innovative ideas come from the uncharted territory of the unknown.

5/ It’s in the moments of uncertainty that we often discover our true resilience. When life doesn’t go as planned, we learn to adapt, problem-solve, and grow stronger. Each challenge becomes an opportunity for personal growth.

6/ Remember that not knowing where you’re going doesn’t mean you lack direction. It means you’re open to the infinite possibilities life has to offer. Sometimes, the best destinations are the ones you didn’t even know existed.

7/ So, the next time you find yourself in a period of uncertainty, embrace it. Embrace the unknown with an open heart and open mind. It might just lead you to a path filled with unexpected beauty and joy.

8/ While having goals and plans is important, there’s a unique kind of magic in not knowing where you are going. It’s a reminder that life is an adventure, and sometimes, the most beautiful destinations are found along the way.

9/ Remember, life’s journey is as much about the destination as it is about the unexpected detours along the way. Embrace the bliss of uncertainty, and let it guide you to new horizons.

19. The Joy of Walking Away

Recognizing when to walk away from the constant pursuit of success and recognition, even when you have the means to sustain your lifestyle, is a reflection of a deeper understanding of what truly matters in life.

It is not just about having the means to do so, but also about choosing a life that is in harmony with your authentic self, regardless of your financial status.

And, by the way, ‘walking away’ is not always about a complete exit from the larger game you are playing.

Like, you can walk away from an investment opportunity that you believe may cost you sleepless nights – maybe, an expensive stock, or a questionable business – and still remain in the investing game.

Or you can walk away from a business deal that does not match up to your levels of integrity, and still remain in that business.

It’s all about the choices we make in life, that determine the paths our lives will take. And then, it’s all about standing with those choices if we continue to believe in them, instead of worrying about what the outcomes may be.

Walking away is not a surrender or a resignation but a conscious choice to reevaluate one’s priorities and regain the balance between ambition and the intrinsic values of love, health, and inner peace.

It is an acknowledgment that the pursuit of external markers of success should never eclipse the fundamental facets of our existence – our bonds with family, our physical and mental health, and our overall well-being.

And the best part? When you learn to walk away from things you think may kill you – financially, mentally, otherwise – you also survive to play the long-term game, in investing or in life. And survival, as we understand, is the only path to true success and happiness.

20. Kind > Clever

Jeff Bezos is known for his remarkable journey from a garage startup to building one of the world’s most influential companies in Amazon. But what’s truly remarkable is this one lesson he learned along the way: which is about the power of kindness over being clever.

Here’s that story verbatim that Jeff first told graduates at Princeton University in 2010 –

My grandfather was driving. And my grandmother had the passenger seat. She smoked throughout these trips, and I hated the smell. At that age, I’d take any excuse to make estimates and do minor arithmetic. I decided to do the math for my grandmother. I estimated the number of cigarettes per days, estimated the number of puffs per cigarette and so on. When I was satisfied that I’d come up with a reasonable number, I poked my head into the front of the car, tapped my grandmother on the shoulder, and proudly proclaimed, “At two minutes per puff, you’ve taken nine years off your life!”

I have a vivid memory of what happened, and it was not what I expected. I expected to be applauded for my cleverness and arithmetic skills. Instead, my grandmother burst into tears. I sat in the backseat and did not know what to do. While my grandmother sat crying, my grandfather, who had been driving in silence, pulled over onto the shoulder of the highway. He got out of the car and came around and opened my door and waited for me to follow.

My grandfather looked at me, and after a bit of silence, he gently and calmly said, ‘Jeff, one day you’ll understand that it’s harder to be kind than clever.’

Think about the people you really admire the most in life. Maybe your teacher, or a friend, or your boss or mentor, or somepne else. They’re probably smart and accomplished, but what truly sets them apart is their kindness. Even when it’s hard, they choose kindness.

Now, cleverness, which is often associated with intelligence and wit, is undoubtedly valuable. It allows us to solve problems, navigate complex situations, and achieve our goals. We all admire clever individuals who can find ingenious solutions to challenges. But what about kindness? It is often overlooked in comparison to cleverness, yet kindness can create connections, build trust, and make the world a better place. It has the power to mend relationships, inspire change, and foster a sense of belonging. Kindness isn’t just about being nice; it’s about understanding, showing respect, and providing support when it’s needed most.

Jeff’s story teaches us that while cleverness is a valuable gift, kindness is a choice that we can make every day. And it’s often the choice of kindness that leaves a lasting impact on people’s lives.

So the question is – how can we choose kindness over cleverness in our daily lives? Well, it’s as simple as offering a helping hand, listening attentively to someone in need, or showing empathy and understanding when someone makes a mistake.

Kindness builds bridges, fosters connections, and leaves a lasting impact on the lives of others. It’s a choice we can make every day, regardless of our circumstances or abilities. So, remember, it’s not just about how clever we are; it’s about how kind we choose to be. In a world that can sometimes seem cold and challenging, let’s warm it up with the choice of kindness. It’s a choice that can change the world, one act at a time.

21. The Eyes See What the Mind Knows

I met a good friend recently who, while sharing some of his lessons from his readings of the Bhagavad Gita, left me with a phrase that has not left my mind ever since. This phrase was – “The eyes see what the mind knows.” I had heard this phrase earlier, but in the busy-ness of life, never got down to reflect on its underlying meaning, which I did after I heard it again from my friend.

And the more I have thought about it, the more I realize that it is packed with deep philosophical perspectives.

First things first, what does this thought even mean, that the eyes see what the mind knows? Now, as little as I understand, it suggests that our perception of the world around us is heavily influenced by our preconceived ideas, our preexisting beliefs, and experiences. In essence, our minds shape the way we see and interpret reality. In fact, our perception is not a direct window to reality but rather a complex filtering process.

Think about it this way – have you ever looked at the same thing as someone else and seen something entirely different? I am sure you have. That’s the mind’s influence on what your eyes perceive.

Let’s quickly explore some philosophical perspectives, including insights from spirituality. In the Bhagavad Gita, Bhagwaan Krishna while imparting wisdom to Arjuna, emphasizes the role of the mind in shaping our perception. Krishna highlights that the mind can be our greatest friend or our worst enemy, influencing how we perceive the world. He suggests that we need to control the mind to truly see and understand the world as it is.

In Indian spirituality, there’s also the concept of “Maya,” which suggests that the material world we perceive is an illusion created by the mind. It’s like a magician’s trick, captivating us with its illusions. Maya challenges us to transcend the limitations of our conditioned mind and see the underlying unity of all existence. It’s an invitation to explore the deeper layers of reality beyond the superficial appearances.

But here’s the kicker: our minds aren’t always accurate. They’re influenced by biases, prejudices, and personal experiences. These biases can cloud our judgment and lead us to see what we want or expect to see, rather than what’s actually there.

So, where does this leave us? Should we distrust our perceptions entirely? I think, not necessarily. The key is to be aware of our biases, acknowledge the limitations of our perception, and strive to expand our horizons. This means being open to different perspectives, challenging our own beliefs, and continuously learning.

From a practical standpoint, I think this concept has relevance in everyday life. It’s about practicing empathy, avoiding snap judgments, and actively seeking to understand others’ points of view. Remember, the eye sees what the mind knows, but the mind can always learn and grow.

Anyways, if there is one thing you can take away from what I shared with you today, it is this –  the idea that your eyes see what your mind knows is a powerful concept that should encourage you to question your perceptions and engage in a lifelong journey of self-improvement and self-awareness. Your mind is incredibly influential in shaping the world you see, but by embracing a more open and objective mindset, you can truly broaden your horizons and foster a deeper connection with the world around you.

22. The Pursuit of Knowledge and Freedom

In our fast-paced world, we’re constantly bombarded with information, from social media to news to educational content, including content like the one you are consuming now. But have you ever stopped to ask this question – what is the true purpose of knowledge? Well, according to the ancient Indian spiritual text Vishnu Purana, it’s quite clear: real knowledge is the one that helps us attain freedom.

Let’s think about this for a moment. We spend so much time accumulating facts and data, but are they making us truly free? Are they helping us break free from the anxieties, worries, and limitations that often define our lives? I think real knowledge should do just that – and that is liberate us from the shackles of our own minds.

And not just this idea from Vishnu Purana, let’s bring in a modern perspective. Charlie Munger once said, “In my whole life, I have known no wise people who didn’t read all the time, none. Zero.” Now, Munger emphasized the importance of continuous learning and reading, but for what purpose? The answer I think is – to enhance our decision-making abilities and ultimately, to lead a better life.

The Vishnu Purana defines real knowledge as that which liberates us. But what does it mean to be free? In this context, freedom isn’t just about physical or political freedom. It’s about freedom from the limitations of our mind, ego, and desires. It’s about transcending the cycle of suffering and finding inner peace.

Imagine a life where you’re not constantly chasing after the next achievement or possession, where you’re not controlled by your desires and fears. This is the kind of freedom the text speaks of. It’s about realizing that true liberation comes from understanding the nature of our own minds and emotions.

The wisest of the wise have told us that the constant pursuit of worldly knowledge, which doesn’t lead to spiritual freedom, is mere amusement. So, this should lead us to reflect for a moment. Many of us chase after knowledge for various reasons – career, social status, or simply to satisfy our curiosity. But if it doesn’t lead to inner freedom, is it truly valuable?

Munger also stresses the importance of multidisciplinary thinking. He believes that gathering knowledge from various fields, from psychology to economics to physics, equips us with mental models that can help us make better decisions. This, in a way, aligns with the idea that knowledge should lead to freedom by enabling us to navigate life’s challenges more effectively.

And going back to the Vishnu Purana, it suggests that too often, we get caught up in the pursuit of material gains, accumulating possessions, and seeking external validation. We may excel in our fields, but if we’re not growing spiritually, are we truly progressing?

In a world that often measures success by wealth, status, and possessions, it’s easy to lose sight of what truly matters. But you can treat this message as a reminder that materialism alone won’t bring us real happiness or freedom. It’s a temporary fix that doesn’t address the deeper longing within us.

Now, I am not advising that we should discard all worldly knowledge. In fact, far from that. Such knowledge is essential for our daily lives, and it can even be a means to attain spiritual wisdom. But the real knowledge, as emphasized in the Vishnu Purana and also by wise people, is the knowledge of the self and the understanding of our interconnectedness with the universe.

Think of spiritual knowledge as the compass that guides us through the maze of worldly pursuits. It helps us see beyond the surface and recognize the deeper meaning of our existence. It’s about understanding that we’re not isolated individuals but part of a greater cosmic tapestry.

Now the question is  – how do you attain this knowledge that leads to freedom? I think it’s a journey that involves self-reflection, meditation, and seeking the guidance of good teachers that can lead us to that path. And this path isn’t always easy. It requires us to look within, confront our fears and attachments, and let go of the ego’s grip on our lives. It’s a journey of self-discovery that can be both challenging and immensely rewarding. But the destination is true freedom, a state of inner peace and contentment.

It’s not about renouncing the world or escaping from our responsibilities. It’s about infusing our everyday lives with mindfulness and awareness. When we strike this balance, we become more grounded and resilient, able to navigate life’s challenges with grace.

In conclusion, the Vishnu Purana and the insights thinkers like Charlie Munger offer us a profound understanding of the nature of knowledge and its ultimate purpose. Real knowledge is the one that leads us to freedom, both from external limitations and inner turmoil. So, as we continue our pursuit of knowledge in this modern age, let’s remember to seek wisdom that brings us true liberation.

23. What Do You Know?

“I know that I know nothing.” – Socrates

I recently read this beautiful couplet from Sant Kabir –

जब मैं था तब हरी नहीं, अब हरी है मैं नाही,

सब अँधियारा मिट गया, दीपक देखा माही |

Translated, it means that when I was immersed in my ego and arrogance, I could not see God (the supreme power). But when I illuminated the lamp of knowledge within myself, all darkness of ignorance vanished, ego went away, and I found God in the light of knowledge.

As we finish with 2023 and enter 2024, if there is anything I wish for you today, this is it.

May you illuminate within yourself – and around you – the lamp of knowledge so that the darkness of ignorance vanishes, ego and arrogance goes away, and you find God in that light of knowledge.

May you find peace amidst the noise all around by lighting your own “inner light” and using it as your guide to become more sensible, smarter, and independent in your decision making – in life and investing.

In the new year, may you light the lamp of love, abundance, compassion, and knowledge in your heart, to serve yourself, to serve others, and to dispel any darkness around you.

There is no better long-term compounding than when you invest in yourself and those around you.

I am sure you are already on that journey. But if you are just starting out, you know where to begin. And now is a great time to start.

I’m so grateful to have you share this journey with me in 2023, and look forward to continuing our connection in 2024, whatever it may bring.

Stay happy and healthy.

Happy 2024.

With respect,
Vishal