With regards to last week’s blog post, first, thanks for all the kind comments.Second, I like the approach the successful investor Howard Marks takes when it comes to cycles. Here are excerpts from one of his recent memos:
”Knowing where you are in a cycle and what that implies for the future is very different from predicting the timing, extent, and shape of the next cyclical move.”
“Cycles are self-correcting, and their reversal is not necessarily dependent on exogenous events. The reason they reverse (rather than going on forever) is that trends create the reasons for their own reversal. Thus I like to say success carries within itself the seeds of failure, and failure the seeds of success.”
It is possible, that a predicted ‘crisis’ does not come to pass at the anticipated time or severity because the majority of the population are expecting it. To quote another great investor, John Templeton: “Bull markets are born on pessimism, grown on skepticism, mature on optimism, and die on euphoria,” he said. “The time of maximum pessimism is the best time to buy, and the time of maximum optimism is the best time to sell.”
Interestingly, Templeton identifies four ‘turnings’ too: Pessimism, Skepticism, Optimism and Euphoria. One reason the US stock market has not crashed is because the majority of the population are not optimistic or euphoric about the stock market. A ‘crash’ is usually identified as abrupt double-digit percentage drops in a stock index over the course of a few days.
A week or so ago, I was at the local cultural center. On the notice board, there was a note on the Bhagavad Gita. Most of it was in Spanish but it did have a small section in English. A sentence there served as a good reminder to me: “The first relationship is with oneself and then follows the relationship with the beings, objects, and situations around us.”
Later that day, I met up with a fellow traveler. Call it synchronicity but he told me about a system for self-discovery. It was developed by a Canadian after a mystical experience. Hmm. Woo Woo? Their website did say the following:“It is not built on belief or faith but is a logical, empirical system that offers you the opportunity to experiment with its mechanics and find out for yourself if it works for you.”. Here is my over-simplified understanding of a sliver of a very complicated system:
- Just like there are 4 seasons in a year, 4 cycles or turnings, there are also 4 types of human beings:
o Manifestor (Initiator)
o Generator (Workhorse)
o Projector (Guide)
o Reflector (Undefined)
- The majority (about 70%) of the population are best as workhorses. This is followed by guides (about 22%), initiators (about 8%) and undefined (about 1%).
- Initiators are the ones that come up with breakthrough ideas and projects. But they don’t “build” it. That’s what the workhorses are for. Guides have the innate capability to understand others and hence to guide them. Knowing what type you are is a step towards living a life without unnecessary resistance. Example: No point for a sloth to try to be a cheetah. It will end up being bad at both. An enlightened sloth realizes its place on earth and is unperturbed by the society’s impression on it. Even though it is “speed-challenged”, it does not mope in self-pity.
- Knowing which type of human being you are is just one step. There are strategies involved with each type. For example, the strategy for “guides” is to wait for an invitation. When it comes to important decisions in life like work, relationship etc. it is best that “guides” are recognized for their value and invited.
There is more to the above system than what I have covered here or know about. Like the Briggs Myers’ personality test and meditation, this is just another tool among many out there to help us know ourselves better.
There is the belief that one can do anything one set their mind to. Hence, it is possible by sheer willpower and brute force that one who is a workhorse becomes a successful initiator. The question is: At what cost? What did that person give up by taking an alternate path? Going back to the sloth example, scientists are discovering that some species of fungi found in sloth fur could eventually be a potent force against certain parasites, cancers, and bacteria. It was the very lack of speed of the sloth that allowed its fur to be a conducive environment for these fungi. Imagine if the sloth had yielded to peer pressure and to keep up with the Joneses, mustered all its energy and picked up speed. Okay, perhaps not as swift as a cheetah but fast enough such that it was no longer a cozy home for the fungi. Wouldn’t that be a loss to society? Scientists did not know about the value of the sloth or the fungi before. Likewise, society might not come to appreciate someone or something until years later. Sometimes, we ourselves may not recognize our own value. But neither does the sloth know that it is harboring microorganisms or that some of these microorganisms will serve to benefit mankind down the road. You never fully know the impact your word or deed may have on another.
“Knowing oneself” can take many forms. Today, with a cheek swab, science can provide a guide on what sort of foods will be beneficial for us or even how one should exercise. Example: The PPARG gene is responsible for differences in unsaturated fat metabolism. I know that I have the genotype that does not do well with unsaturated fat. But there are others whose genotype implies improved metabolism of unsaturated fat. So, two people making identical diet and lifestyle choices can manifest different health outcomes because of the differences in their genetic dispositions. ‘Bad’ genes do not automatically lead one to a certain disease. Genes merely load the gun but our lifestyle fires it. Knowing your genetic blueprint can help you to make informed diet choices relevant to you.
It may be good to know where we are in the various cycles. But it is more important to ‘know thyself’. It is a sad day if Google and the likes know us better than we know ourselves.
To end on a humorous note, a picture of a T-shirt I came across in Antigua, Guatemala: