Grant, Walker and Dalio — Nitin Chaudhary

Apr 7

Apr 7 Grant, Walker and Dalio

Three good thinkers/researchers came out with useful content last week. Here is a brief summary:

• Organisational psychologist, Adam Grant, gently nudges us in this piece to consider why we often receive bad advice, and what are some of the ways to improve the situation. The reason why we end up getting bad advice is that we go to the wrong source — people who’ve had very different contextual understanding than us. That’s not their fault but of the situations they have faced and the experience they have gathered in their lives, which is different from the ones we may be facing. “Today, the world is changing so fast that people become wise for a world that’s no longer there,” he quotes Tim Urban to explain the point. If we are asked for an advice, what can we do to get out of this ‘contextual fallacy’? Grant suggests that instead of a conclusive recommendation, it’s the process of reaching it that’s more helpful. Which means, when asked for an advice, walk the process, weigh in pros and cons together with the person seeking it. Yet another important learning I took from the piece was that those who gave advice in such a manner (i.e. process-centric than result-centric) often end up seeing some form of improvements in their own lives. Simply put, helping others negotiate options or address a difficult situation helps us think about how we can implement some of those steps in our lives as well. So the best way to become wiser and implement some good advice is by listening ‘to the advice you give to others. It’s usually the advice you need to take yourself’. The practical takeaway I took with me is to distance myself from the situation I am facing, use a paper and pen to write the advice to myself, and assume that I am doling it out to a good friend.

• Matt Walker, who I have written about earlier here, did a long-form interview with TED in which he stresses the point that this lockdown period is perhaps the best opportunity for us to put our sleep in order. You can find the interview here. If you haven’t read Walker’s excellent book Why We Sleep, then I definitely recommend listening to this interview where he covers the main points. Catching up on sleep is especially important in the current times, since sufficient sleep is a prerequisite for a stronger immunity. An important point that I was reminded of again was that electronic devices, such as phones are a no-no, not only because of the blue light they emit, but also because of the brain stimulation that non-stop messages and social media provide, which in turn creates anxiety resulting in disturbed sleep. Yet another reminder was about the use of over-the-counter melatonin hormone. According to Walker, some of the pills they tested contained substantially different quantity of the hormone per pill than listed on the bottle. Therefore, it’s better to keep sleep aid supplements only for the times when struggling with special situations such as jet lag, and not for daily use.

• Ray Dalio of Bridgewater Associates wrote this long-form reflection on how the situation we are facing currently seems unusual and unique. However, such situations have arisen many times before in the history, albeit we may not have witnessed them in our lifetimes. Unexpectedly, the best students of history are often sharp investors, such as Dalio, (another one who comes to mind is Jim Simons) who leverage often forgotten historical events to compare the current situations and predict how the future would look like (of course, to benefit from it financially). Dalio explains this point as follows: ‘As I studied history, I saw that this confluence of events was typical of periods that existed as roughly 10- to 20-year transition phases between big economic and political cycles that occurred over many years (e.g., 50-100 years)’. Dalio’s approach is to read related historical events deeply and coalesce his understanding into what he calls an ‘archetype’. Moreover, how these archetypes were historically resolved could lead to a set of principles (he calls them ‘if-then’ statements) that can be applied in the current situation as well (obviously only if the current archetype matches the historical one). For me the interesting takeaway from this essay was how Dalio thinks, and it reconfirms the point that I have come to strongly believe in, which is: history is often the best predictor of the future.

A quote that I was reminded of last week: