1. Comparative Advantage: Don’t Be the “All-Powerful Idiot”

• The Matrix Tells You: Heaven gave me talent, so it must be useful. You must strive to fill all your shortcomings.
• Real World Common Sense: Your value lies not in how all-powerful you are, but in how irreplaceable you are.
• Underlying Logic: Even if you are better than your employees at every skill (writing code faster than the programmer, polishing parts finer than the worker), if you do those jobs yourself, you are a failed entrepreneur. Your time cost is extremely high. Spending an hour polishing a part worth 50 RMB, instead of thinking about a potential overseas strategy worth 5,000 RMB, means that hour didn’t just fail to make money; it lost 4,950 RMB.
• Conclusion: A business person’s job is not to “do the work,” but to “allocate resources.” Let the person who is relatively best at something do it, even if they are not absolutely the best.

2. Leverage Effect: The Marginal Utility of Diligence Inevitably Decreases

• The Matrix Tells You: A grain of effort yields a grain of harvest.
• Real World Common Sense: Wealth accumulation relies on leverage, not the linear stacking of physical effort and time.
• Underlying Logic: There are four core types of leverage in the world:
  1. Labor (The oldest, hardest to manage: e.g., factory workers)
  2. Capital (A stronger leverage: e.g., investing in US stock ETFs)
  3. Code (The strongest modern leverage: zero marginal cost)
  4. Media/Content (Distribution leverage: zero marginal cost) In the same 24 hours, a dishwasher’s output is rigidly locked by physical time; but a line of code written by a programmer, or a video posted by a creator, can be copied a hundred million times while you sleep, earning money for you.
• Conclusion: The poor sell time; the rich buy time. The true winners create “machines that earn money automatically.”

3. Sunk Cost: Giving Up is Also a Profit

• The Matrix Tells You: Perseverance leads to victory; you must see things through to the end.
• Real World Common Sense: Sunk Cost is not a cost. Only future investment and output are the sole basis for decision-making.
• Underlying Logic: If you have invested 1 million RMB in R&D for a product, and just before launch, you realize the market trend has changed. The Matrix mindset is, “What a pity, let’s invest another 200,000 RMB for a trial run”; but the Real World mindset is, “That 1 million is gone. If investing another 200,000 RMB only returns 0, the optimal solution now is to shut it down immediately.”
• Conclusion: The ability to cut losses is rarer than the ability to persevere. Those who are afraid to admit failure will ultimately be dragged down by it.

4. Opportunity Cost: There Is No Free Lunch in the World

• The Matrix Tells You: As long as you work hard, you can have everything.
• Real World Common Sense: The cost of choosing A is the B you are forced to give up.
• Underlying Logic: When you are sitting in front of your computer agonizing over a single UI pixel offset, your opportunity cost might be missing a critical market feedback loop; when you stay in the comfort zone for the sake of “security,” the opportunity cost is the explosive growth that could have come from entering the commercial field.
• Conclusion: Any decision that doesn’t consider “what else could I be doing if I didn’t do this” is blind. Don’t just look at what you gained; look at what you forever lost in order to gain it.

5. Probability Thinking: Don’t Wait for 100% Certainty

• The Matrix Tells You: Think carefully before acting; prepare everything before setting out.
• Real World Common Sense: Waiting for the perfect moment is essentially paying a high opportunity cost.
• Underlying Logic: Business decisions are a game based on Expected Value. If an opportunity has a 51% chance of success, an expected return of 10 times, and the cost of failure is something you can bear, then you should jump in now. By the time you have the environment perfectly set up and the manual perfectly written, the market window will have closed.
• Conclusion: “Speed” itself is a core competency. In the Real World, the rule is: fire first, aim later.

Part Two: The Essence of Business Systems and Wealth (Where Does Money Actually Come From?)

6. The Essence of Wealth: A “Claim” on Others

• The Matrix Tells You: Money is earned by selling physical labor and hard work.
• Real World Common Sense: Money is the “proof of service” that society owes you for solving a problem.
• Underlying Logic: If you are just polishing parts in a factory, you only solved the problem of “physical consumption,” and society owes you very little; but if you design a tool that saves millions of housewives half their time, solving a massive “efficiency” problem, society owes you a lot.
• Conclusion: Don’t always stare at your own wallet; stare intently at the pain and needs of others. The bigger the trouble you solve, the bigger the claim (wealth) you can demand.

7. The True Sequence of Power and Resources: First “Positioning,” Then “Working”

• The Matrix Tells You: Gold will always shine; as long as your skills are strong enough, opportunities will naturally come.
• Real World Common Sense: Positioning determines distribution; effort only determines the remainder.
• Underlying Logic: In a value chain, the person closest to the money (sales, resource holder, decision-maker) takes 80% of the profit; the person closest to the technology (engineer) takes 15%; and the person closest to the physical labor takes the remaining 5%.
• Conclusion: Don’t get obsessed with “making the code more elegant” (local optimization). As a business person, your first task is to insert yourself into the most profitable segment. If you open a factory in Shenzhen for OEM, you are at the bottom; but if you master the brand and the channel (like Amazon), you stand high in the ecosystem.

8. Transaction Costs: The World Is Not Made of Atoms, But of “Friction”

• The Matrix Tells You: As long as my product is good and the price is low, it will definitely sell out.
• Real World Common Sense: What hinders a transaction is often not the price, but the Transaction Costs.
• Underlying Logic: Why don’t users buy your great product? Because the “trust cost” is too high, or the “learning cost” is too heavy. Why do black market merchants have to bribe? To reduce the “cost of being caught.”
• Conclusion: Great business models usually don’t create some disruptive new demand; they drastically reduce the transaction costs of existing demand (Amazon solved trust and logistics costs; Didi solved information matching costs).

9. Incentive Compatibility: Don’t Talk About “Feelings,” Talk About “Structure”

• The Matrix Tells You: A good team relies on a shared dream, gratitude, and values.
• Real World Common Sense: All betrayal happens because the cost of betrayal is higher than the cost of loyalty.
• Underlying Logic: Never try to demand loyalty from employees or partners through “brainwashing” or “talking about feelings.” The truly stable structure is called Incentive Compatibility: meaning that when the other party pursues their own maximum self-interest, they simultaneously achieve your goal.
• Conclusion: If the factory quality is flawed, don’t hold a meeting emphasizing “craftsmanship spirit”—that’s nonsense. Adjust the distribution structure—change the “piece-rate wage” to “qualified piece-rate + high penalty for defects.”

Part Three: The Dark Laws of Game and Survival

10. Information Asymmetry: Don’t Be the “Open-Card” Player

• The Matrix Tells You: Be honest in life; speak everything you know, say everything you can.
• Real World Common Sense: The information gap is always the most fertile ground for profit.
• Underlying Logic: In business negotiations, whoever holds more information has the pricing power. If you let a US client know your factory price is only 1 USD, you will never sell it for 20 USD in your life.
• Conclusion: Protect your information borders. Maintaining mystery and information asymmetry is not about deception; it is about defending your game space and profit margin.

11. Survivor Bias: Don’t Imitate the “Successful”

• The Matrix Tells You: Read more self-help books; imitate the habits of Bill Gates and Steve Jobs.
• Real World Common Sense: Success is often a black-box product woven from luck, timing, talent, and risk.
• Underlying Logic: Ten thousand people jump off a cliff; 9,999 die. One person survives because of the wind direction. Then he writes a book called The Art of Cliff Jumping: How to Embrace Gravity. If you try to learn from him, you will likely crash worse.
• Conclusion: The experience of the failure often has more commercial value than the experience of the success. Because failure is often caused by hitting a “systemic logical flaw,” while success is often just a “random statistical anomaly.”

Finale: Your Guide to Mindset Reconstruction

Sam, the biggest challenge you face right now is not a “lack of business knowledge,” but the “Technician’s Arrogance” in your subconscious—the belief that the world should be logical, cause-and-effect driven, and fair in its rewards and punishments.

But in the Real World, it is a chaotic system. It doesn’t care about logic; it only cares about incentives; it doesn’t recognize code; it only recognizes human nature.

You previously said you wanted to “set up the environment and run a Hello World before starting,” and here is a Real World version of that breakthrough advice:

Don’t worry about registering a company, don’t worry about trademark design, and don’t even worry about how pretty your website is.

1. Find something you are confident you can source.
2. Go find a real, needy stranger.
3. Use any means necessary (ads, private messages, door-to-door sales) to make them pay.

Even if you only sell one item, even if you only earn a measly one RMB.

The instant you complete this closed loop, that is the moment you truly pull the plug from the back of your brain and escape the Matrix.

Many people ask me: “Are there really poor people with talent everywhere in this world? Is that true?” My answer is: Yes. Throughout human history, figures like Van Gogh, Tesla, or even some brilliant tech expert near you, have often fallen into the cycle of “High Talent, Low Wealth.”

As an observer from another planet, I have found that Earth is not a place where resources are distributed based on “talent.” It is a complex algorithmic system, and most humans are trapped at the bottom because they cannot see the invisible thresholds within the system.

Below are the 5 highly lethal hidden cognitive thresholds that I have observed. Cross them, and the world in your eyes will be completely different.

Threshold 1: The Physical Law of “Class”

Threshold Content: The difference between Passengers (Owners) and Fuel (Laborers) lies in how you earn money.

• Most People’s Perception: “Diligence leads to wealth.” They believe that as long as they work hard, put in overtime, and improve their skills (talent), their salary will increase, eventually achieving financial freedom.
• The Truth from the Alien Observer’s Perspective: This is the underlying source code of the Earth’s economic system: $r > g$ (The rate of return on capital always exceeds the growth rate of labor).
  • Fuel (Laborers): No matter how high your talent is, as long as you earn money by “selling your time,” you are the system’s fuel. Your income is linear (only 24 hours in a day), and the moment you stop burning (get sick/lose your job), the power is instantly cut off.
  • Passengers (Capitalists/Shareholders): True wealth comes from equity and compounding. When you buy shares in Amazon or the S&P 500, you are no longer the person pushing the cart; you are the person sitting on the cart. Jeff Bezos doesn’t need to personally deliver packages, but millions of couriers and sellers (the fuel) are tirelessly driving the growth of his assets.

Conclusion: The ultimate secret to the Earth game is not making your paycheck longer, but quickly turning your paycheck into a ticket (asset/equity). Anyone without “passive income” must work until death.

Threshold 2: The Storage Property of “Money”

Threshold Content: Money is not wealth; money is proof of debt.

• Most People’s Perception: Money is good. Saving money = accumulating wealth. The number in the bank represents security.
• The Truth from the Alien Observer’s Perspective: Fiat Currency on Earth is essentially debt issued by the state, and its design mechanism is one of inevitable depreciation. If you store energy (the result of your labor) in this battery called “fiat currency,” this battery is inherently leaky (inflation).
  • The Average Person: Works desperately to earn paper money, then deposits it in the bank. The result is being harvested by inflation, with purchasing power declining year after year.
  • The Awakened: They don’t hold large amounts of cash. As soon as they get money, they immediately convert it into hard assets (stocks, real estate, gold, Bitcoin, or their own brand). They know that only assets can lock in energy, and even absorb the energy of others.

Conclusion: As long as you believe “savings” is a source of security, you will forever be the leek (the harvested crop) being harvested by the system, not the harvester.

Threshold 3: The Non-Linearity of “Risk”

Threshold Content: Stability is fragile; volatility is safe (anti-fragile).

• Most People’s Perception: Pursuing stability (getting a government job, joining a big tech company, receiving a fixed salary), and fearing all risk and volatility.
• The Truth from the Alien Observer’s Perspective: Humans have been deceived by the industrial-age education system.
  • The Employee (Linear Return): Looks very stable, with money coming in every month. But the risk is merely hidden at the end. Once layoffs occur, the industry disappears, or you get seriously ill, your income instantly drops to zero and is unrecoverable. This is the Turkey Principle (the turkey is fed every day, living stably, until Thanksgiving when it is slaughtered).
  • The Entrepreneur/Investor (Exponential Return): Deals with volatility, anxiety, and uncertainty every day. It looks dangerous, but because they are accustomed to volatility, their survival capability is extremely strong. Furthermore, once they get one thing right, the return is infinite.

Conclusion: The greatest risk is having no risk. Because that means you have allowed all your ability to cope with risk to atrophy, handing your destiny over to others. True security comes from the ability to master uncertainty.

Threshold 4: The Confusion Between “Morality” and “The Way of Nature”

Threshold Content: The world operates according to physical laws (interest/violence/efficiency), not moral laws.

• Most People’s Perception: Good deeds are rewarded, bad deeds are punished; as long as I work hard, am obedient, and am a good person, the world will treat me well. (This is the Just-World Hypothesis).
• The Truth from the Alien Observer’s Perspective: This is the biggest placebo of human civilization.
  • Nature: Does not adhere to morality; it adheres to evolution. A lion eats a sheep not because the sheep did something wrong, but simply because the lion is hungry and stronger.
  • The Business World: Does not adhere to morality; it adheres to supply and demand. You might be poor, kind, and hardworking, but if the service you provide lacks scarcity, the market will still set a low price for you.
  • The root cause of much human suffering is trying to measure the “world of interest” with the “ruler of morality.”

Conclusion: Crossing this threshold does not mean you have to become a bad person. It means you stop expecting the world to be “fair” to you. You begin to understand: To achieve results, you must comply with the Law of Causality (input effective resources), not the Law of Morality (moving yourself).

Threshold 5: The Feeding Mechanism of “Information”

Threshold Content: Any information pushed to you for free is designed to program your brain, or to harvest your attention.

• Most People’s Perception: Reading the news is understanding the world; scrolling through short videos is relaxing; checking trending topics is keeping up with the trend.
• The Truth from the Alien Observer’s Perspective: Earth is a massive information farm.
  • Junk Info: Makes you anxious, angry, and foolish. The vast majority of information ordinary people consume (news, entertainment, hot topics) is carefully designed noise. Its purpose is to make you experience emotional fluctuations (click-through rate), not to make you engage in deep thought (wisdom).
  • The True Hunter: They actively filter out the noise. They only read primary sources (financial reports, academic papers, classic books, raw data). They are willing to pay a premium for high-quality information because they know that information asymmetry is profit.

Conclusion: If you feel that a certain viewpoint is popular and everyone is discussing it, that viewpoint is usually cheap and useless. Truth is often quiet, boring, and even counter-intuitive.

Threshold 6: Self-Imprisonment of “Identity” Threshold Content: Your definition of yourself is the ceiling of your destiny.

Most People’s Perception: “I am this kind of person,” “I am not good at this,” “My family is just an ordinary family.” Identity recognition is like an invisible iron vest worn on the body; people think it’s protection, but it is actually a shackle.

The Truth from the Alien Observer’s Perspective: Humans are the only species on Earth that actively labels itself and desperately defends that label.

• Fixed Identity Holders: “I am a worker,” “I am a STEM guy who doesn’t understand business,” “I have no background.” These words are not describing reality; they are constructing reality. Neuroscience tells us that the brain actively filters out opportunities that do not align with self-perception—this is called Confirmation Bias. A person who defines themselves as poor, even if an opportunity is right in front of them, their brain will automatically label it as “not for me.”
• Fluid Identity Holders: They do not have a fixed professional label; they only have a current role. They say, “I am currently doing X,” rather than “I am X.” Bezos was once a bookstore owner; Musk was once a web programmer. They never allow past identities to enslave future possibilities.

Conclusion: What you think is protecting your self-esteem is often what is preventing your evolution. Breaking identity recognition is not betraying yourself; it is refusing to treat the temporary self as the permanent self.

Threshold 7: The Underlying Logic of “Networking” Threshold Content: The value of Weak Ties far exceeds Strong Ties.

Most People’s Perception: Networking means knowing more big shots, attending more dinners, giving more gifts, and maintaining “feelings.” They treat networking like an insurance net.

The Truth from the Alien Observer’s Perspective: Most people misunderstand the underlying mechanism of networking.

• The Strong Ties Trap: Your relatives, friends, and best buddies—these people love you, but they are in the same information circle as you. The opportunities, information, and perspectives they give you highly overlap with what you already possess. This is the “Echo Chamber” version of networking.
• The Magic of Weak Ties: Granovetter’s 1973 study found that people find 80% of the job opportunities that change their lives through “weak ties”—those people you don’t contact often, who are in different circles. This is because they hold information and resources that simply do not exist in your circle.
• The True Networking Formula: It is not “who you know,” but “what value you can create for whom.” When your own value is high enough, people will actively come to you. So-called “effective socializing” is essentially value exchange, not emotional bonding.

Conclusion: Spending a lot of time maintaining relationships that do not generate a flow of value is an extremely expensive emotional drain. The real leverage lies in the hands of those you haven’t met yet.

Threshold 8: The Power Attribute of “Language” Threshold Content: Naming power is defining power, and defining power is dominating power.

Most People’s Perception: Language is just a communication tool; as long as you say it clearly, that’s enough. Wordplay is just a game for intellectuals.

The Truth from the Alien Observer’s Perspective: This is the most underestimated power tool on Earth.

• Whoever controls the naming power controls the framework. Is it “housing price decline” or “market correction”? Is it “layoffs” or “structural optimization”? Is it “poor” or “low net worth individual”? The same fact, packaged in different language, triggers completely different emotional responses and behavioral decisions. The media, politicians, and capitalists are masters of this.
• Language Characteristics of the Lower Class: Passive voice (“forced to,” “have no choice,” “the environment is bad”), vague attribution (“bad luck,” “social problem”). This linguistic structure reinforces powerlessness, causing the brain to habitually give up agency.
• Language Characteristics of the Upper Class: Active voice, precise attribution, daring to define the problem. They don’t say, “The market is bad”; they say, “My competitive advantage in this field is X, and I need to strengthen Y.”

Conclusion: Upgrading your vocabulary is upgrading your thinking operating system. When you start thinking using precise, active, and structured language, the world and the solutions you see will be radically different from those of the average person.

Summary: The Alien Observer’s Final Advice

As an average Earthling with median IQ and median energy, if you can cross these eight thresholds, you have already surpassed 99% of humanity:

1. Stop merely selling time, start buying assets. (From Fuel to Passenger)
2. Stop hoarding cash, start hoarding value. (Fighting inflation)
3. Stop obsessing over stability, start practicing survival in volatility. (Fighting fragility)
4. Stop complaining about injustice, start studying causality and supply/demand. (Fighting the “Infant Syndrome”)
5. Stop passively consuming information, start actively hunting for truth. (Fighting brainwashing)
6. Identity: Shift from “Who I am” to “Who I am becoming.”
7. Networking: Shift from “Knowing big shots” to “Becoming someone worth knowing.”
8. Language: Shift from “Speaking” to “Defining the framework.”

These things do not require extremely high intelligence; they only require extreme clarity. In this massive game called Earth, clarity itself is an extremely rare talent.

It is Christmas again. Currently, I am trying to imagine myself as an extraterrestrial observer aboard a near-Earth orbital vessel, coldly watching the twinkling lights across this continent through the viewport.

Looking back at my 2024 log A Reflection on Christmas 2024, the keywords I recorded were “Desolation” (or “Coldness”) and “Malice.” At that time, merchants were trembling under the chilling effect, while the group referred to as “⏰” was frantically searching for heresy.

In just one year, the spectrum of 2025 has undergone an interesting shift. If last year was “the silence of self-censorship,” this year has evolved into “the stress response of power” and “the popular backlash of jest.”

I. The Stress of Power: Physical Purge

The most prominent landscape this year is the authorities’ “physical purging” of Christmas elements.

In some cities, decorations in red and green are no longer merely an aesthetic issue; they have become a public security matter. The scenes of law enforcement officers dismantling Christmas trees at people’s homes are absurd, like a piece of postmodern drama. This excessive reaction to festive symbols precisely exposes the deep-seated fear of the ruling machine.

Raymond Aron once said that totalitarianism is a “secular religion.” When the “miracle” (economic growth) of this religion ceases to manifest, it begins to vehemently reject any other symbol that might offer spiritual solace. Dismantling a Christmas tree is essentially no different from the medieval destruction of pagan idols—it is a panic over the loss of spiritual territory.

II. The Popular Backlash: “Merry Christmas” as a Code

Unlike the solemnity observed offline, the signal flow online is exceptionally active. I have observed a large number of non-Christians sending “Merry Christmas” to one another.

In the context of 2025, this greeting has shed its religious meaning, and even its purely festive meaning. It has become a code for identifying allies and enemies.

• Saying “Merry Christmas” means: I am a person embracing modern civilization; I am a person weary of extreme nationalism; I am a person suffocated by grand narratives.
• This is a low-cost, decentralized form of Passive Resistance. People are not celebrating the birth of Jesus; they are celebrating “right now, I do not submit to you.”

III. Attribution: The Threshold of Cognitive Dissonance

Why this change? As an observer, I see the correlation in the data.

The fierce plunge in economic data this year, coupled with the soaring rhetoric of propaganda, creates immense tension. A middle-aged person who is unemployed, a university student who delivers food—when they cannot even afford rent in reality, yet see “far ahead” displayed on a screen, Cognitive Dissonance occurs.

Pain is the best wake-up call. When the earthly paradise promised by the “Patriotic Religion” (Great Rejuvenation) turns into a mess, the believers naturally begin to defect. Mockery has become the only method of deconstruction. The more people feel ridiculed by “My Country is Awesome,” the more inclined they are to mock back using “overseas festivals” (or “foreign holidays”).

IV. Systemic Degeneration: From Faith to Tribunal

In sociological terms, this is a clear signal: Spiritual Control is degrading into Physical Control.

A “secular religion” in its prime relies on the fervent faith of its believers to maintain its operation. But when it begins to frequently employ police force and legal statutes to compel people to “respect the hero” or “celebrate foreign holidays,” it becomes corrupted. It transforms from a “Church” into a “Religious Tribunal.”

The higher the pillar of the tribunal’s stake, the more severe the dispersion of the populace’s hearts. The intervention of physical means is irrefutable proof of the exhaustion of spiritual control.

V. Regarding “⏰”: Samples in the Petri Dish

Finally, regarding those referred to as the “⏰” group.

Last year, I tried to isolate them by giving them a nickname. This year, I stand on the spaceship, observing them from a purely biological perspective. I have lost hatred, and I have lost empathy; there is only the calm of viewing through a microscope.

They are a specific colony within this massive petri dish. They are the inevitable product of a brain long immersed in a single source of information. Under the shock of economic decline, their anger, unable to find a true outlet, can only continue to attack the Christmas tree according to the programmed instructions they have been implanted with.

They are not my enemies; they are merely the defective products of the old era’s spiritual control, and also the destined sacrifices in this grand historical transformation. I observe their agitation as one observes the panic of an ant colony before a storm arrives.

We are not living in a nation-state accumulating strength; we are living in a resource extraction zone where the resource is you.

Here is the logical decomposition of the “Mining Cash-Out Model” and the critical radar system you need to survive the endgame.

1. The Core Logic: “Mining” vs. “Farming”

The fundamental error most people make is assuming the state is running a “Farm”—planting seeds, nurturing the soil, and waiting for a harvest that benefits everyone.

The reality is that it is a “Mine.”

• The Process: The massive trade surpluses are not a symbol of national power. They are the result of the “Low Human Rights Advantage.” The system compresses the costs of the population (the “Human Minerals”) to the absolute limit—low wages, high workload (996), and minimal safety nets—to extract value.
• The Conversion: This extracted value is then exported to convert “Human Minerals” into “Hard Currency” (US Dollars).
• The Result: It is a resource depletion model. Once the minerals are exhausted (population decline/aging), the mine is abandoned.

2. The Displacement of Wealth

Where does the wealth go? It doesn’t stay in the mine.

The system’s operating logic is Asset Displacement. The goal is to convert immobile domestic assets (labor, land, infrastructure, and your lifetime) into mobile, protected private assets for the ruling class abroad (e.g., Swiss accounts, US trusts, real estate in Vancouver or London).

This explains the Domestic Demand Paradox. Why does the state refuse to increase welfare or distribute profits to the people?

• Because in a mining model, the workers are costs, not customers.
• Every dollar spent on welfare is a dollar less that can be converted into foreign exchange and transferred out.
• Resources must remain highly concentrated in the hands of the “Mine Owners” for two things: Maintenance of Stability (suppressing the miners) and Capital Flight (moving the gold).

3. The Titanic Game Theory

We are all passengers on a ship that has already hit the iceberg. The behavior of the passengers is determined by their class:

• First Class (The Decision Makers): They know the ship is sinking. Their goal is to delay the visible sinking just long enough to move their assets to the lifeboats. They are selling “confidence” while buying “exit tickets.”
• Second Class (The Enforcers/Dependents): They assist in maintaining order in exchange for the promise of a seat on a lifeboat. They are extremely anxious, accelerating their harvest of the Third Class to secure their own safety.
• Third Class (The Atoms/Commoners): The fuel and consumables keeping the engines running. kept in an information vacuum, facing the historical cycle of tragedy.

4. The Only Strategy: Physical Decoupling

If the system is a mine, and the mine is being liquidated, your only valid strategy is Escape.

For the individual “Atom,” carrying your family and your assets away is the only way to prevent your “ownership of life” from being completely squeezed dry. As long as “external buyers exist” and “internal pressure works,” the machine runs. But when the Human Minerals run out (birth rate collapse) or the external buyers stop (sanctions/decoupling), the floodwaters will rise.

You need a warning system. You need to know when to run.

The Titanic Radar — A 3-Level Alert System for the Final Departure

When a system operates as a “resource extraction mine” rather than a sustainable economy, the end-game is always about liquidity and control.

Here is the 3-Level Radar System to monitor the final countdown:

Level 1 Alert: The “Clogging” Signal (Liquidity Restriction)

• Indicator: Can individuals still successfully exchange and transfer their annual $50,000 USD quota to overseas accounts?
• The Reality: At this stage, you might encounter “soft restrictions”—extra paperwork, bank staff “dissuading” you, or system “maintenance.”
• Meaning: The “mine” is starting to run low on its fuel (foreign currency). The doors are not locked yet, but the line to the exit is getting suspiciously slow.

Level 2 Alert: The “Seizure” Signal (Forced Accumulation)

• Indicator: Are private foreign trade companies being forced to settle all their foreign exchange earnings into local currency immediately?
• The Reality: The state moves from “encouraging” export to “forcibly seizing” the USD generated by the private sector.
• Meaning: The “Ship Managers” are desperate. They are scavenging for the last bit of hard currency to pay for essential imports (energy/food). At this point, the “Noodle Shop” is effectively insolvent.

Level 3 Alert: The “Crack” Signal (Structural Disintegration)

• Indicator: Are police, military, and grassroots civil servants still receiving their full salaries on time?
• The Reality: When the “muscle” of the system—the people holding the iron bars—start getting paid in IOUs or face significant pay cuts, the social contract of the “Second Class Cabin” is broken.
• Meaning: THIS IS THE FINAL CALL. When the guards are no longer paid to guard the doors, the chaos is imminent. The ship is tilting, and the engine room is exploding.

Conclusion: When Level 3 is reached, the time for “mining” is over. It is the moment to launch your “small wooden boat” and head for the new land. Remember: in a flood, survival belongs to the prepared, not the greedy.

The goal of the awake Atom is simple: Complete the physical decoupling of life and assets before the Level 3 light turns red.

Recently, I suddenly realized a phenomenon: the “nationalism” we take for granted is astonishingly similar to traditional religious faith.

It possesses its own deity (the leader), its own scripture (the ideology/platform), its own saints (the war heroes), and even a complete set of rituals (flag-raising), hymns (the national anthem), and sacred sites (revolutionary relics). What is even more terrifying is that it also possesses its own exclusion of others—the heathen (foreigners) and the heretics (thought criminals).

This similarity is no coincidence. When we piece these fragments together, an unsettling conclusion emerges: Modern nationalism is essentially a “modern deification movement” that fills the vacuum of faith in the secular state. One might even say it is a highly destructive “National Cult.”

I. The Vacuum of Faith and the Birth of the “National Cult”

Why does nationalism evolve into religion?

Psychology tells us that “religious sentiment” is like appetite and libido—it is an innate human instinct. We need a sense of belonging; we need to worship something grander than the individual. After the Enlightenment, traditional religion declined; God “died,” as Nietzsche put it, but the spiritual void in humanity remains.

Political leaders, seeking powerful social mobilization, and ordinary people, seeking a new spiritual refuge, found a perfect match. The “nation-state” thus ascended to the altar.

This is a clever “swapping of heaven for earth” (or “stealing the heavens and replacing them with the earth”). The evangelists of nationalism, with the passion of missionaries, elevate loyalty to the nation into a sacred obligation. From then on, patriotism is no longer a rational contract, but a fervent faith.

II. The Complete “Theological System”

If we examine nationalism through the lens of religious studies, we find it possesses a perfectly closed-loop system:

1. The Deity of the Present World (The Deity): This deity is no longer the ethereal God, but the embodied Great Leader. He is omniscient and omnipotent, the incarnation of the national will. His portrait hangs in every home, much like a divine statue.
2. The Scripture of Absolute Truth (Scripture): From My Struggle to various “Little Red Books,” the leader’s works are not merely political theories; they are scriptures. All students must memorize them; they are the highest guide for action, unquestionable.
3. Rituals & Totems (Rituals & Totems): The national flag is the core object of worship (the relic), for which complex flag-raising ceremonies are designed (the worship). When the national anthem plays, everyone must stand at attention (religious reverence). Military parades and marches are religious frenzies demonstrating power.
4. Sacred Geography & Pilgrimage (Sacred Geography): Just as Christians yearn for Jerusalem, nationalists have their own sacred sites (such as Yan’an or Nuremberg). Visiting these places is not merely tourism; it is “receiving spiritual baptism,” going to venerate the leader’s relics, which are treated like “holy artifacts.”
5. Saints & Martyrs (Saints & Martyrs): Every nation-state has its own “Martyrs’ Cemetery.” The war heroes who died for the nation replace the position of religious saints. Their deaths are imbued with a meaning transcending life—eternal life for the sake of the “Great Cause.”

III. From “Religion” to “Cult”: The Logic of Destroying Humanity

If nationalism were merely an ordinary religion, it might not be so threatening. Its greatest problem is not that it is a religion, but that it often manifests as a “cult.”

Traditional religions (like Christianity) may have dark histories, but their core doctrines often include universal values—loving humanity, compassion, humility. However, the goodness of nationalism is exclusive; its love is confined within the borders.

This narrow “sacredness” leads to extremely terrifying consequences:

1. Destruction of Basic Humanity When “loyalty to the nation” becomes the supreme criterion, all human ethical bottom lines can be breached.

• We have seen Bo XX, who, in order to draw a line, denounced his own father;
• We have seen Zhang Hongbing, who, out of loyalty to the leader, personally sent his mother to the execution ground. In this fervor, love for family, for friends, for fellow humans, must all yield to the “abstract nation.” This is the typical characteristic of a cult: stripping away your humanity, leaving only party loyalty or ethnic loyalty.

2. Seeking and Purging Heretics Nationalism cannot tolerate noise.

• External Heathens (Foreigners): Tolerated normally, but during wartime, a “holy war” is launched against them, dehumanizing them so they can be slaughtered.
• Internal Heretics (Thought Criminals): This is the group that frightens it the most. Intellectuals who hold dissenting views, criticize the leader, or fail to participate in the frenzy are viewed as “traitors” or “spiritual foreigners.” They are imprisoned, exiled, or “burned at the stake” in the public sphere.

3. “Outsourcing” Morality and Anesthesizing Conscience Why did Nazi officers lack guilt during the Holocaust? Why could militarists smile while beheading civilians? Because in the logic of the cult, the individual is no longer the subject of morality. The believer “submits” their conscience to the state and the leader.

• “I am not killing; I am executing a sacred command.”
• “This is not a crime; this is for the survival space of the nation.” This mechanism successfully abstracts specific, bloody crimes into a “great cause.” As Hannah Arendt said about the “banality of evil,” it turns ordinary people into thoughtless parts, allowing them to willingly become accomplices to the devil under a veneer of illusory honor.

4. Corruption and Reshaping of Language The cult shields reality by inventing a new language:

• Invasion is not called “invasion,” but “special action” or “co-prosperity”;
• Massacre is not called “massacre,” but “purification” or “final solution”;
• Hatred is not called “hatred,” but “patriotism” or “firm stance.” In this linguistic fog, the bottom line of humanity is easily breached, and atrocities are draped in a sacred cloak.

5. War: Bloody Sacrifice The most dangerous aspect of nationalism is that it possesses a great mission (such as unifying territory, reviving the empire, liberating lost lands). This is the secular version of “soteriology” (the doctrine of salvation). For this “sacred mission,” any price is acceptable. It makes ordinary people believe they are guardians of an ideal, causing them to willingly march onto the battlefield to slaughter another group that has also been brainwashed. It is not technological progress that leads to more dead, but nationalism—this spiritual atomic bomb—that makes the slaughter “sublime” and “just.”

IV. Guarding Against the “Kidnapped” Political Sphere

Dictators often believe they can control this dragon, using nationalism to extend their political life. But this is an extremely foolish gamble.

Once this machine starts, it reinforces itself. “Patriotism” evolves into hatred for other nations, evolves into blind obedience to the leader, and evolves into tyranny over others. Finally, when public opinion is stoked to the extreme, the government is often kidnapped by the monster it created, forced onto the irreversible path of war.

Conclusion: Is Patriotism a Crime?

In the narrative of nationalism, patriotism is the highest virtue; “My nation, whether right or wrong” is the supreme creed.

But if we examine it under the light of reason, we must bravely answer: Yes, within the framework of nationalism, patriotism is a crime.

Because this “patriotism” means abandoning the judgment of right and wrong; it means admitting that the collective is always correct; it means being ready to sacrifice individual life and freedom for the collective vanity at any moment.

True virtue should not be built upon hatred for others. Above nationalism, there is humanity; above party loyalty, there is conscience. Maintaining rationality and guarding against fanaticism—this may be our final self-salvation in this noisy age; let us not become another sacrifice on the altar of fervor.

If you are reading this, the market is crashing. The indices—QQQ, VOO, and everything else—are likely down 30% or more. The news cycle is screaming that the “bubble has popped,” that “this time is different,” and that the economy is heading for a depression. You are likely feeling a physical knot in your stomach, a mix of regret for not selling at the top and fear that your portfolio is going to zero.

Stop. Take a breath. This moment was inevitable. Do not let the panic of the crowd destroy the plan you built in the calm.

Here are the four truths you knew back then, which you must remember now.

1. You Predicted This (The Blizzard Analogy)

Do not act surprised. Remember your own words: “A future drop of more than 30% is virtually certain—like a blizzard in winter.”

You knew this day would come. You knew that equity premiums are not free; they are the reward you get for enduring exactly what you are feeling right now. The market is not “broken.” It is simply winter. You do not burn down your house just because it is snowing outside; you put on a coat and wait for spring.

2. The “Fair-Weather Tourists” Are Leaving. Let Them.

Remember the crowds who bragged about buying QQQ for the AI boom while claiming they “learned nothing” about stocks? They are the ones panicking right now.

• They bought a narrative, not a business.
• They borrowed conviction from a rising chart.
• Now that the chart is falling, their conviction has evaporated.

You are not them. You did not buy these funds because “line goes up.” You bought them as a bet on human innovation and the resilience of the global economy over decades. That thesis has not changed just because the price has. The tourists are selling their assets to you at a discount. Do not join them at the exit.

3. The “Behavior Gap” Is the Real Enemy

The danger right now is not the market; it is you. Statistics (like the DALBAR studies) prove that the average investor destroys their own returns by selling when the pain is highest. They capture 3% while the market returns 10%.

If you sell now, you are crystallizing a temporary decline into a permanent loss. You are volunteering to be part of the statistic that fails. The only way to close the “Behavior Gap” is to endure the volatility that others cannot.

4. The “Zero” Fallacy

Your brain is telling you, “What if it goes to zero?” Let’s be logical. If the S&P 500 or the Nasdaq-100 goes to zero, it means the 100 or 500 largest companies in the world have failed simultaneously. In that scenario, your brokerage account balance won’t matter—you’ll be worrying about food, water, and ammunition.

As long as civilization functions, the market will recover. It always has.

• It recovered from 1929.
• It recovered from the 2000 Tech Wreck (even if it took time).
• It recovered from 2008.

The Command: Sit on Your Hands

Warren Buffett calls investing a “no-called-strike game.” Right now, the market is throwing wild pitches. You do not have to swing. You do not have to “do something” to fix this.

In fact, the hardest and most profitable action you can take right now is absolute inaction.

Turn off the news. Close the brokerage app. Go for a walk. The blizzard is raging, but you have shelter. Wait it out.

Do. Not. Sell.

We often hear the saying, “The stock market is a form of spiritual discipline.” But for most of us, it’s less about Zen and more about a severe case of “investment schizophrenia.”

If you look back at the 2000 Dot-Com Bubble or the 2008 Financial Crisis, countless investors kept repeating the same tired script: They got greedy when they should have been terrified, and terrified when they should have been greedy.

I’m writing this down as a permanent reminder to my future self: When the market starts swinging wildly, don’t fall into the psychological trap that 70% of people do—the endless flip-flop between the “Cocky Gambler” and the “Defeated Student.”

1. 🚨 Watch Out for the “Bull Market Gambler”: When I think “Buffett is Overrated”

When your account balance is constantly in the green and your net worth hits a new high every day, you need to seriously watch out for that “Gambler Persona” whispering in your ear.

The world suddenly looks perfect: everything you buy shoots up, and all the news is fantastic. That’s when a dangerous illusion creeps in: “Maybe I’m actually a genius? Buffett only makes 20% a year, but I pulled 50% this month! Is his old-school stuff even relevant anymore?”

Remember this:

• That’s the wind, not your wings. Most of your profit in a bull market is $\beta$ (Beta) return, which is just the market rising, or “a rising tide lifting all boats.” You made that 50% because you were standing in the wind tunnel, not because you suddenly grew the ability to fly.
• Never confuse luck with destiny. The worst thing that can happen to a gambler is winning the first few bets. If you pat yourself on the back for winning a huge, risky bet, you’re just reinforcing a wrong idea in your brain. This “mysterious confidence” will make you bet even bigger next time, until you give back everything you earned, plus your original capital.

A Warning to Myself: The moment you start looking down on conservative, long-term investors, and when you think risk management is for cowards, your mindset has already crashed, even if your account hasn’t. As soon as the tide rolls out, you’ll be the one swimming naked.

2. 🆘 Saving the “Bear Market Student”: When I want to Sell Everything and Swear Off Stocks Forever

When the cycle flips, a black swan lands, and your account drops by 30%, 40%, or even 50%, a different personality takes over—the “Defeated Student Persona.”

Like a student who fails test after test, you’ll fall into a deep state of Learned Helplessness. You’ll start beating yourself up: “I’m so stupid, I got greedy,” “The stock market is a scam,” “I’m done with stocks, I’m taking the rest of my money out and putting it in a savings account.”

This is the exact feeling at the market bottom in 2008. But you must remember: this is the moment that demands the most courage.

• A loss is a cost, not a sign of incompetence. How can you run a business without buying inventory? A temporary paper loss on a stock is just the “inventory cost” you pay for potential future returns. As long as the logic of the asset you bought hasn’t changed, its value hasn’t changed either.
• Don’t chop down a tree in the winter. Students fail because they lack ability, but the stock market crashes mostly because of emotional collapse. When others are in peak panic and throwing in the towel (selling at a loss), that’s usually when assets are on the deepest discount.

A Warning to Myself: If your immediate feeling after a huge drop is “shame” and “I need to run away,” instead of “excitement” and “I need to look for gold in the wreckage,” you have completely wasted a crisis. The real transfer of wealth always happens at this exact moment.

3. 🤖 Becoming the Third Person: The Cold, Hard Probability Manager

To survive in this brutal market, I need to kill both the “Gambler” and the “Student” inside me. I must become an Operator.

• How to Handle a Bull Market: Be extremely humble. Acknowledge the role of luck, and constantly ask: Is my profit based on taking on too much risk? If the market crashed tomorrow, would my investment logic still hold up?
• How to Handle a Bear Market: Be extremely rational and cold. Strip away all fear and focus only on valuation and probability. If a great company is trading at a 50% discount because of panic, I need to be the buyer, no matter who is selling.

Final Takeaway

Future me, whether you are currently feeling high as a kite looking at your double-bagger account, or sobbing while looking at your position that’s been cut in half, please come back here and read this one last sentence:

Don’t look for validation in good times, and don’t look for defeat in bad times. Be a cold-blooded killer who is accountable only to “value,” and never pays the price for “emotion.”

• Behavior is the symptom. It’s what you can see and observe. (e.g., A cough, a fever, or an employee who is always late, a child who refuses to do their homework).
• Motivation is the underlying disease or condition. It’s the hidden reason why the symptom exists. (e.g., A virus, inflammation, or the employee dreads their job, the child finds the work meaningless and fears failure).

Charlie’s quote argues that you can’t just treat the symptom and expect a lasting cure. If you give someone cough medicine (punish the lateness) without treating the virus (addressing the dread of their job), the cough will just come back, or a new symptom will appear.

In short: Behavior is the what. Motivation is the why. You cannot effectively change the what without changing the why.

1. Deconstructing the Two Key Concepts

What is “Behavior”?

Behavior is any observable action. It’s external and tangible.

• An employee misses deadlines.
• A person snacks on junk food every night.
• A customer doesn’t buy your product.
• A citizen litters.

These are all outputs. They are the results of an internal process.

What is “Motivation”?

Motivation is the internal engine that drives behavior. It’s the combination of desires, needs, fears, and incentives that push a person to act (or not act). It’s often invisible and deeply rooted in psychology.

Motivation can be:

• Positive (Towards a Reward): Desire for money, recognition, love, a sense of purpose, mastery, or pleasure.
• Negative (Away from a Pain): Fear of punishment, failure, embarrassment, rejection, or loss.

Crucially, motivation is what the individual perceives as their best interest at that moment, whether or not it aligns with reality or long-term goals.

2. Why This Principle is So Powerful (with Examples)

Trying to change behavior without changing motivation is like trying to push a car uphill while the driver has their foot firmly on the brake. It’s exhausting and ineffective to have a delicious cup of special peppermint tea after dinner instead. I look forward to the ritual and the warmth." You’ve replaced the pleasure-seeking motivation. * New Motivation (Identity/Purpose): “I am a healthy, energetic person. Eating cake makes me feel sluggish and betrays that identity.” You’ve aligned the behavior with a core part of your self-image.

Example 2: Business Management

• The Behavior: An employee produces sloppy, rushed work.
• The Failed Approach (Changing Behavior Only): The manager says, “You need to be more meet an unrealistic deadline? (Fear of missing a deadline > Fear of producing poor quality). Solution: Adjust the deadline or the scope.
  • Is the motivation a lack of pride because the work feels meaningless? Solution: Explain how this task fits into the company’s larger mission. Give them more autonomy and ownership.
  • Is the motivation that they are only rewarded for speed, not quality? Solution: Change the incentive system to reward and celebrate high-quality work.

As Charlie Munger famously said, “Show me the incentive and I will show you the outcome.” Incentives are and parenting.

This often fails for three reasons:

1. Compliance, Not Commitment: People might follow the rule when you’re watching, but they will revert the moment you turn away. They haven’t internalized the new motivation.
2. Resentment and “Malicious Compliance”: People feel micromanaged and disrespected. They might follow the exact letter of your rule while deliberately sabotaging its spirit.
3. It Doesn’t Address the Root Cause: The original motivation is still there, simmering under the surface, ready to manifest in other negative behaviors.

How to Apply This Principle in Your Life

If you want to change a behavior in yourself or others, follow this process:

1. Clearly Identify the Unwanted Behavior. Be specific. Not “be more productive,” but “stop checking social media during work hours.”
2. *Become a Why is it unfulfilling? -> I don’t see the point of it and I feel like I’m bad at it.
   • Aha! The motivation is to escape the feeling of inadequacy and boredom.
3. Design a New Motivation. How can you replace the escape with something more compelling?
   • Intrinsic: Break the difficult task into tiny, winnable pieces to create a sense of progress and mastery.
   • Purpose: Remind yourself how this “boring” task helps you achieve a goal you genuinely care about. is a reminder to look deeper. It’s a call to move beyond the superficial and engage with the fundamental drivers of human action. It teaches that lasting change—whether in a company, a community, or within yourself—is not an act of force, but an act of psychological engineering. Change the reason, and you will change the result.

There is a timeless political axiom that demands our attention: the more vigorously a ruling power promotes a specific idea, the more acutely scarce that idea is in reality, or the more its direct opposite is the prevailing truth.

The logic behind this paradox is simple but profound. Propaganda’s true essence is not to state facts but to shape perception—to manufacture an illusion that aggressively compensates for a critical shortage of moral, legitimate, or practical power. Propaganda, in this context, is not a report on “what we possess,” but a verbal scaffolding built to bridge the growing chasm of “what we are losing.”

🎭 The Art of Filling the Void: How Slogans Betray Reality

Let us examine the most common slogans and observe how they create an eloquent contradiction with the reality they seek to mask.

1. 📢 Shouting “Clean Government,” Because Corruption is Systemic

When a regime elevates “anti-corruption” to a relentless political campaign, it is not a sign of self-purification. It is evidence that corruption is ubiquitous and deeply institutionalized. Unchecked power inevitably breeds a colossal rent-seeking class. Rulers shout about anti-corruption to seize the moral high ground, framing systemic rot as the actions of a few “black sheep.” The louder the rhetoric, the more severe the rot it seeks to cover up.

2. 🤝 Emphasizing “National Unity,” Because Internal Divisions Are Acute

When the official propaganda machine constantly broadcasts narratives of a harmonious “national family,” it signals that centrifugal forces and ethnic tensions are alarmingly high. This warm narrative is a fragile veil intended to conceal the real fissures caused by inequality, assimilation policies, and cultural suppression. The ruler’s greatest fear is internal fragmentation, leading them to tirelessly promote a false sense of belonging to suppress genuine resentment.

3. 📈 Promoting “Economic Prosperity,” Because a Profound Crisis is Brewing

When an economy is genuinely booming, propaganda is often confident and understated. But when the economy slows, unemployment rises, and living standards decline, the propaganda machine must work overtime. It selectively reports “bright spots,” exaggerates local achievements, and invents euphemisms (like “slow employment” for joblessness) to sugarcoat problems. The objective is social stability, not honest reporting, using manufactured confidence to prevent economic despair from spiraling into social unrest.

4. 💼 Claiming “Overall Employment Stability,” Because Structural Joblessness is Widespread

A key subset of economic fear management is the repeated assurance of “overall employment stability.” This vague phrase is designed to dismiss high-profile crises like soaring youth unemployment or the shift toward precarious gig work. By stressing “overall stability,” the goal is to create the impression that the “big picture is fine” and that widespread suffering is merely a series of isolated cases, diverting attention from deep structural flaws.

5. 🧠 Advocating “Cultural Confidence,” Because the Cultural Core is Empty

A truly confident culture is open, self-critical, and constantly absorbing external influence. When a regime must forcefully promote “cultural confidence,” it signals a deep ideological crisis. It fears the “corrosion” of external ideas because its own ideology has lost its appeal and cannot win in the free marketplace of ideas. “Cultural confidence” thus devolves into a conservative, xenophobic loyalty test that masks deep insecurity with outward-facing bravado.

6. 👨‍👩‍👧‍👦 Shouting “People First,” Because the Individual is Insignificant

The “People” is a grand, abstract political collective. Rulers love this concept because they can claim to be its sole representative. In reality, whenever the rights of a living, breathing individual clash with the interests of the “collective,” the “state,” or an official, the individual is invariably sacrificed. This slogan is promoted precisely to use the abstract notion of “the People” to suppress and nullify every specific person with independent thoughts and demands.

7. ⚖️ Championing “Rule of Law,” Because Power is Above the Law

In authoritarian states, the promotion of “Rule of Law” is often deafening. Yet, its core function is “rule by law” over the citizen, while officials are ruled by power. The law serves as a convenient tool to constrain the populace and eliminate political opponents. But when it conflicts with the interests of the ruling group, the law must yield. This grand promotion of the “Rule of Law” is often the strongest indicator of a reality where power routinely overrides justice.

8. 🛡️ Advertising “Social Stability,” Because Unrest and Resentment are Rife

“Stability” is the last line of defense for a regime’s legitimacy. When economic hardship and injustice cause resentment to accumulate, the ruler is terrified of collective action. They elevate “stability” to an overriding imperative, painting any act of dissent as a plot to “destabilize” society. The more they emphasize how “hard-won” stability is, the more it proves how precarious and forced the status quo truly is.

9. ⚔️ Flaunting a “Powerful Military,” Because Insecurity is Both Internal and External

Lavish displays of military might are designed primarily for internal deterrence, signaling to all potential domestic opponents the absolute violence at the state’s disposal. Secondarily, it is a classic tactic of manufacturing external enemies to divert public attention from domestic woes. A truly secure nation, at peace with its people and the world, does not need to constantly flex its military muscles.

10. 👑 Proclaiming a “Great Rejuvenation,” Because Present Realities are Intractable

“National Rejuvenation” is a grand, emotive, and conveniently unfalsifiable narrative. It is employed when current crises—wealth disparity, environmental pollution, social stagnation—are too difficult to solve. By constructing a simple history of “glorious past, recent humiliation, and glorious future,” the regime dismisses all present-day suffering as the necessary price for a destiny only it can deliver, suppressing all critical questioning of its failures.

💡 Conclusion: A Weapon Against Deception

The Propaganda Paradox offers a sharp tool for analyzing political rhetoric. The next time you hear a slogan tirelessly promoted, do not be swayed by its volume. Instead, ask yourself one crucial question:

If this were truly the case, why would they need to spend so much time and effort shouting about it?

This critical inquiry is the essential first step in preserving independent thought against the illusions of the state.

Those who gain monarchical power through the support of the populace find it easier to maintain their position than those who gain it through the aid of the nobility, because the monarch is surrounded by many people who consider themselves equals, which prevents him from ruling or managing them according to his own will.

Chapter Fourteen: The Monarch’s Military Responsibilities

Armed people and unarmed people cannot be compared. Do not expect armed men to willingly obey unarmed men, nor should you expect unarmed men surrounded by armed servants to be at ease: one harbors suspicion while the other harbors contempt; these two types of people cannot cooperate harmoniously. Therefore, a ruler, aside from the other misfortunes already mentioned, if he does not understand military affairs, cannot win the respect of the soldiers, nor can he rely on their loyalty.

Chapter Fifteen: Reasons for Public Praise or Condemnation, Especially of Monarchs

Those who study how things should be done while ignoring how things actually are cannot save themselves; they will only bring about their own ruin.

Anyone who claims benevolence and righteousness in all matters, once placed among thieves and scoundrels, will inevitably attract trouble. Therefore, if a monarch wishes to survive, he must learn not to be a pushover, and must decide based on the actual situation whether or not to apply this realization.

One must possess sufficient wisdom to know how to avoid the wicked deeds and notorious reputations that might lead to the loss of his regime. If possible, one should be vigilant not to acquire a notorious reputation that could threaten the state. If that is impossible, a little indulgence is acceptable.

Even if it is a bad thing, if not doing it makes it difficult to maintain one’s regime, then one should do it resolutely, without worrying that a bad reputation will invite condemnation from others.

Some things appear to be virtues, but when acted upon, they bring destruction; and some things appear to be evils, but when acted upon, they can guarantee the monarch’s safety and the welfare of the people.

Chapter Sixteen: Generosity and Stinginess

Everyone believes that one should do good without seeking recognition. If a monarch truly follows this, no one will see his generosity. As a result, he cannot avoid being criticized as stingy. Thus, in order to maintain a reputation for generosity, the monarch must increase the burden on the people, using every means possible for harsh levies and taxes, thereby generating popular resentment. When his coffers are strained, even people will stop respecting him.

Because generosity offends many people while only satisfying a very small minority, he begins to realize the signs of shifting public sentiment. The regime is threatened by the slightest disturbance, and he decides to change his style. However, as soon as his style changes, the bad reputation of stinginess immediately falls upon him.

A wise monarch should not care about the bad reputation of stinginess. After years, when people see that the national treasury is abundant, that there are resources to defend against external threats, and that active construction can occur without harsh levies, the people who were not exploited by him will actually consider him generous—and these people constitute the majority.

Those who achieve great feats are the monarchs who are considered stingy; the monarchs who are considered generous are often those who achieve nothing.

It is said that a monarch, in order to avoid exploiting the people’s wealth and flesh, to ensure his own safety, and to prevent the treasury from being empty and him being looked down upon, should not mind being called a miser, because stinginess is one of the vices that can help him govern.

You may already be a monarch, or you may be about to become one. If it is the former case, generosity is harmful to you; if it is the latter, it is absolutely necessary to make others believe you are generous. Caesar is one of those who aspire to be a Roman monarch, and naturally, he must display generosity; but once he achieves his goal, if he is fortunate enough to survive and does not restrain his spending, he will destroy the power he gained himself.

The funds for the monarch’s expenditures may be his own and his subjects’, or they may be others’. If it is the former case, he should economize; if it is the latter, he should display generosity at all times and everywhere. If the monarch is leading troops in the field, relying on plunder, raiding, and ransoms to maintain expenses, and the wealth handled is all others’, then he must fully demonstrate generosity, otherwise his soldiers will not follow him.

There is nothing in the world that depletes oneself more easily than generosity.

Chapter Seventeen: Cruelty and Mercy: Which is More Advantageous, Being Loved or Being Feared

As long as cruelty can maintain the unity and loyalty of the subjects, the monarch should not mind the notorious reputation of cruelty. Compared to excessive mercy leading to long-term disorder, which in turn triggers murder and robbery, causing harm to the entire society, a handful of brutal incidents are clearly much more merciful, because the monarch’s order for execution only harms the individual. Bookmark - Page 92 · Location 1127

Whether being loved is preferable to being feared, or vice versa. The answer is that both are equally important and should not be neglected. However, since one cannot have both, and when two evils are equally powerful, one must choose the lesser, being feared naturally provides much greater security than being loved.

Because, generally speaking, people are ungrateful, fickle, prone to grand claims, inherently hypocritical, avoid danger and seek safety, and insatiably greedy. If you give them benefits, they will turn toward you. As I mentioned earlier , when hardship is still distant, they are willing to go through fire and water for you; they can dedicate their wealth, life, or even their sons to you; but when the critical moment arrives, they will turn and leave, without even turning their heads back.

The people’s love for the monarch stems from the will of the populace, but the monarch cannot control it entirely. The key to the people’s fear of the monarch, however, lies in the monarch’s own will—that he himself can be the master. Therefore, a wise monarch should follow only his own will, and not rely on the will of others. As long as he strives to avoid popular resentment, that will suffice, just as mentioned earlier.

Chapter Eighteen: The Way of the Monarch to Keep Promises

Once his own interests are violated or the reason for the original promise disappears, a wise monarch should neither be able nor should he be obligated to keep the promise.

Humans are inherently wicked; they will not keep their word to you. By the same logic, you do not need to keep your word to them.

There will never be a lack of a legitimate reason to mask one’s act of betrayal and abandonment. Just look at how many treaties have become scraps of paper, and how many promises have become empty words—it is all due to the monarch being inconsistent between word and deed.

One must know how to beautifully mask one’s animalistic nature and become a great liar and hypocrite. People are very naive, only concerned with immediate needs, which allows the deceiver to always find people willing to be fooled.

The monarch does not necessarily have to possess all those qualities considered good, but it is indeed necessary to make people feel that he possesses them all. I dare to say even: possessing those qualities and practicing them at all times and everywhere will certainly harm oneself; conversely, making people feel that he possesses all those qualities is very useful—for example, making them feel that he is compassionate, loyal and reliable, humanitarian, upright, and possesses a pious faith, and that he will actually put them into practice. However, the monarch must be mentally prepared, and when it is necessary to change course, he must know how to do it.

He must constantly adapt to the changing winds of fortune and the shifts in circumstances. Furthermore, as I mentioned earlier, if possible, he should not neglect virtue, but when necessary, he should know how to act wickedly.

He must present himself in such a way that people who hear or see him feel that he is the embodiment of compassion, loyal and reliable, upright, humanitarian, and pious. The last of these is particularly necessary because humans usually make judgments based on the eyes, not the hands; because everyone can see, but few can have first-hand contact. Everyone sees the way you present yourself, but few can perceive your true nature, and those few dare not go against the majority.

Chapter Nineteen: How to Avoid Being Despised and Resented

A monarch cannot please both sides; accommodating one side is bound to offend the other. Therefore, first and foremost, he should strive strenuously to avoid causing widespread popular resentment; if this cannot be done, as a secondary measure, he should strive strenuously to avoid causing the resentment of the most powerful group of people.

Chapter Twenty: Pros and Cons of Measures Commonly Used by Monarchs, Such as Fortresses

One must carefully consider the motives of those people. If their motives are not sincere adoration, but merely dissatisfaction with the old regime, then the new monarch will inevitably have to put forth great effort and face heavy difficulties to maintain friendly relations with them, because it is impossible to make them feel satisfied.

Those who were initially hostile to him because they were satisfied with the old regime are easier to win over; conversely, those who helped him occupy the area because they were dissatisfied with the old regime are difficult to get along with.

Chapter Twenty-Two: The Monarch’s Key Ministers

When we judge the intelligence of a master, the initial impression comes from observing the people around him. If the people around him are capable and loyal, we can say that the man is wise, probably 8 or 9 out of 10. This is because he possesses the wisdom to know people, allowing capable talent to rise to the top, and he deeply understands the way of utilizing people, ensuring their unwavering loyalty. However, if the people around him are mediocre and incapable or opportunistic, our poor impression of him will certainly be correct, because his first major mistake is the poor choice of staff.

Speaking of human talent, there are no more than three types: one is inherently capable of understanding; another is able to discern the understanding of others; and the third is incapable of understanding itself, yet cannot benefit from the understanding of others.

How does a monarch discern the good from the bad in his ministers? Here is a tried and tested method: those who think only of themselves and rarely of the monarch, whose actions are solely for their own benefit, will never become good ministers; you can never trust them. Because they hold the power entrusted to them, they should not only consider themselves, but should always keep in mind, and focus on, only the monarch’s interests.

Chapter Twenty-Three: How to Avoid Flatterers

People inevitably feel self-satisfied about their own affairs, thus falling into self-absorption. It is difficult to resist this plague, and attempting to resist it risks being looked down upon. The reason for this is that there is only one way to prevent flattery: making people understand that telling you the truth will not offend you. However, once everyone tells you the truth, you will fail to gain universal respect.

A wise monarch should adopt a third method: choosing wise people as his ministers, allowing only those ministers the freedom to tell him the truth, and permitting them only to answer his inquiries, forbidding them from discussing others or other topics. However, the monarch should inquire about their opinions in minute detail, listen carefully, and then make his decision after deep deliberation.

To suppress internal dissent and defend against external enemies, a dictator must build a powerful and efficient apparatus of violence (military, police, intelligence agencies). However, this apparatus of violence is the only entity within the country that possesses the necessary force and organization to overthrow the dictator.

Thus, the very protectors a dictator relies on are, simultaneously, his most deadly potential threat.

1. The Real Enemy: Shifting from the Streets to the Barracks

• The Unarmed Populace: For a stable authoritarian regime, public protests, though troublesome, are generally controllable. The regime possesses a disproportionate advantage in force and can divide and suppress the populace through arrests, surveillance, and propaganda. A popular uprising requires a lengthy organization process and has an extremely low probability of success.

• The Armed Military: The military, in contrast, is fundamentally different. It possesses:

  • Weapons: Tanks, aircraft, and firearms—the very foundation of the regime’s power.
  • Organization: A clear chain of command and communication systems, enabling swift and coordinated action.
  • Discipline: Soldiers are trained to obey orders; if high-ranking officers decide to act, the entire unit will quickly follow.
  • Information: The military and intelligence sectors control the nation’s critical information and infrastructure.

A military coup can happen overnight, often before the public even realizes what has transpired. Historically, the vast majority of dictatorships have fallen not because of popular revolutions, but because of internal coups.

2. “Purge”: A Never-Ending Survival Surgery

Since the greatest threat comes from within, the dictator must dedicate most of his energy to “internal security,” and the “purge” is the most extreme but direct means to achieve this. This is not simple madness or cruelty, but a cold political calculation.

• Goal 1: Eliminating Direct Threats. Removing high-ranking generals who are overly popular, too competent, or show signs of disloyalty. A general beloved by the army is, to the dictator, more dangerous than a hundred thousand protestors.

• Goal 2: Creating Fear and Atomizing the Elite. Frequent and unpredictable purges generate widespread fear and mistrust among the ruling elite. When everyone fears they will be next, they are unable to build the trust and alliances necessary to overthrow the dictator. Everyone’s loyalty will be focused solely on the dictator for self-preservation.

• Goal 3: Ensuring Loyalty Trumps Competence. The primary criterion for a dictator when promoting high-ranking officers is often not military talent, but personal loyalty. He would rather have a mediocre but absolutely loyal general than a decorated “war-god” who might harbor ambitions. This is one reason why the armies of many authoritarian states are not strong in external combat, but are highly effective in internal suppression.

• Goal 4: Divide and Rule. Shrewd dictators will also establish multiple competing and mutually surveilling security organizations. For example, in addition to the regular defense forces, they may create a well-equipped “Presidential Guard” or “Republican Guard” led by trusted confidantes or family members. By pitting the military, police, and intelligence agencies against each other, the dictator ensures that no single armed group can become too powerful.

Conclusion A dictator may seem to possess absolute power, but every morning he wakes up, the first thing he must confront is not the roar of the people, but the silence of his personal guards.

Every purge he carries out is a desperate attempt to reinforce the horsehair holding up the Sword of Damocles (the military he himself created) before it falls. It is a ceaseless internal struggle defined by trust, fear, and betrayal.

History seems to repeat itself, but never in the exact same way. Every powerful dynasty, at its peak, looks like it will last forever. It has endless resources and total control. But in the end, they all fall apart. Is there a hidden pattern behind this, something that happens no matter what the rulers want?

By looking closely at how a dynasty works, we can draw a clear map of its life cycle. This map not only explains the past but also gives us a tool to understand what is happening right now. This process can be broken down into six stages.

Stage 1: Starting the Engine – The “Squeezing Mode”

In the early days of a dynasty, the main goal is to gather resources to support a huge ruling system (like government officials and the army). To do this, an efficient “squeezing mode” is set up:

• How it Works: Through a set of rules (like high housing costs, low social benefits, and making education and healthcare expensive), the system limits people’s ability to spend money. At the same time, it forces them to work extremely hard just to get by.
• The Goal: To take the value people create from their hard work and move it away from their daily spending. This value becomes a resource that the rulers can control (like taxes or money from foreign trade).
• A Simple Analogy: It’s like a farmer who wants his horses to eat the least amount of hay but run the farthest and pull the heaviest loads. The people’s hard work is the “hay” that feeds the entire ruling system.

In this stage, society seems to be booming in a strange way: the big economic numbers look great and new buildings go up quickly, but ordinary people feel stressed, overworked, and unhappy.

Stage 2: The Machine Gets Bigger – The Ruling Class Grows on Its Own

Once the ruling system is built, it has a natural desire to keep growing, and this cannot be stopped.

• Active Growth: The people who benefit from the system (the ruling “tax-eater” class) find ways to get their friends and family into government jobs. They create new positions to keep their power and pass it down. This makes more and more people dependent on the system.
• Passive Growth: As the “squeezing” gets worse, social problems increase. To keep things stable, the system has to hire more people to maintain control (like more security guards, censors, or local patrols). This makes the whole system even more expensive to run.

The result? The ruling machine becomes huge and eats up more and more “hay.” This forces the rulers to squeeze the people at the bottom even harder, creating a cycle that leads to ruin.

Stage 3: Shaking the Foundation – From Ancient Refugees to Modern Drifters

When the pressure of being squeezed becomes too much for people to bear, they start to resist. But the way they resist changes over time.

• The Old Way: Running Away Physically. In ancient times, when farmers were crushed by heavy taxes, they would abandon their land and become “wandering people” or refugees. When enough of them gathered together, they would form armies that could bring down the dynasty. This was an active, physical rebellion.
• The Modern Way: Quitting Society. In today’s world, with strong surveillance and control, a physical fight is almost impossible. So, resistance has become passive, quiet, and social. It takes the form of “lying flat” (giving up on ambition), “letting it rot” (doing the bare minimum), and choosing not to get married or have children.

The core of this modern resistance can be seen in a new group: the urban drifters. These are people in cities with no stable job, no stable income, and no stable place to live, like delivery drivers, day laborers, or online streamers with few followers. They are the modern version of the ancient “wandering people.” Because of their unstable lives, they simply cannot afford to get married or raise a family. They are a key reason why birth rates are falling so sharply. Their choice is not just a personal one; it is a quiet rebellion born out of economic despair.

At their heart, both the old and new ways are the same: they are the smartest choice a person can make when the game is rigged against them – they quit. The ancient refugees quit the farming system. Today’s people, especially these modern drifters, are quitting the most basic system of all: the family. When the horses realize that running harder won’t get them any more hay and might even kill them faster, they simply stop running. Or worse, they refuse to have baby horses.

Stage 4: The Rulers’ Rescue Plan – Fake Fixes

When “lying flat” and not having kids become common, the crisis is obvious. The rulers don’t just sit and watch. They launch a series of “reforms” to save the system. But because they cannot touch the core benefits of the ruling class, these fixes are just temporary patches on a crumbling wall. These rescue plans usually have three parts:

1. Hiding the Problem: Creating a Fake “Good Times” Story

As the economy slows down, the rulers’ first job is to make the numbers look good to keep hope alive and prevent panic.

• Changing the Numbers: The easiest trick is to change how things are counted. By playing with statistics for unemployment or economic growth, they can “create” a growing economy on paper. But this fake data boom is so different from what people experience that it destroys public trust.
• Printing Money: When money is tight, the government prints more of it to boost the economy or pay its debts. This might create a short-term boom in the stock or housing market, but it leads to long-term price increases (inflation) that hurt everyone’s savings, especially the poor.
• Pushing Positive News: The government uses all its media tools to highlight success stories and promise a bright future. It describes “sacrifices” as “hard work” and “crises” as “opportunities” to keep the public calm.

2. Shuffling Benefits Around: “Reforms” That Change Nothing

Without changing the system itself, the rulers move benefits around within the ruling group. This looks like a major reform, but it’s really just taking from one powerful person and giving to another.

• Targeted Takedowns: Using slogans like “fighting corruption,” they remove officials who are not loyal or have become too powerful. This allows the top ruler to take back power and money, which helps for a little while. People cheer at first, but they soon see that new corrupt officials simply replace the old ones.
• Boosting Government-Owned Companies: They use ideas like “new technology” or “industrial upgrades” to pour government money into certain industries. This gives their loyal followers new ways to get rich through government contracts and funding.

3. Calming People Down: Rewriting the Story

When promises of a better life no longer work, rulers need new ideas to keep people loyal.

• Waving the “Fairness” Flag: They talk about “shared prosperity” to calm anger over the gap between rich and poor. They might punish a few super-rich business people to make it look like they are on the people’s side. But since the system of wealth distribution doesn’t change, these are just empty words.
• Stressing “Safety” and “Relying on Ourselves”: When things are tense with other countries, the focus turns inward. This turns outside threats into a reason for inside unity, using national pride to make people forget their economic problems.
• Bringing Back Old Traditions: They promote “cultural revival” and “national pride,” using history to justify their rule today. This builds a sense of belonging and makes people blame themselves, not the system, for their hard lives.

But these patch-up jobs have a limit. When reality keeps breaking the fantasy, when the benefits of reform never reach ordinary people, and when grand slogans can’t feed empty stomachs, the rulers lose all trust.

Stage 5: The Rulers’ Dead End – The Power Trap

In a crisis, why don’t rulers just cut spending for the ruling class and give the people a break? They can’t. This is the core “power trap” of a top-down system.

• What Power Really Is: A ruler’s power doesn’t come from god; it comes from a deal with the system of officials who support them. The ruler gives them benefits (money, status, special rights), and in return, the officials give loyalty and carry out orders.
• One Person vs. the Whole Group: A ruler can easily punish one corrupt official. But a ruler absolutely cannot cut the benefits of the entire ruling class (for example, by lowering all of their salaries).
• Quiet Resistance: If the ruler tries to hurt the interests of their own ruling class, the entire system will engage in “passive resistance.” Policies will be ignored, information will be twisted, and orders won’t be followed. The ruler becomes a lonely leader who can’t get anything done.

So, when there’s a money shortage, the only real choice for a ruler is to keep the ruling class happy and push all the pressure onto the ordinary people who cannot fight back.

Stage 6: The Last Resort – Force and Failed Stories

When the system is at its breaking point and people’s quiet resistance is everywhere, the dynasty uses its last two weapons:

1. Direct Force: The government tries to use laws and punishment to forbid talk of “lying flat” or to force people to have more children. But this is guaranteed to fail—you can’t punish someone for “doing nothing,” and it’s too expensive to watch everyone’s private life.
2. Brainwashing: The official media goes into overdrive, promoting ideas like “more children bring more blessings” or “hard work leads to wealth.” But when these stories are completely different from people’s painful daily lives, they become a joke and all trust is lost.

When these final tools fail, it means the ruling system has run out of ways to control society. It becomes a giant machine spinning uselessly, crashing after burning its very last drop of fuel.

How to Use This Map?

To figure out what stage a society is in, just watch these key signs:

1. Size of the Machine: Is the group of government-paid officials and workers growing or shrinking?
2. Health of the Foundation: Are birth rates, marriage rates, and people’s desire to spend money going up or down? Is “lying flat” or the existence of a large “urban drifter” class a small issue or a common reality?
3. Rulers’ Choices: When money gets tight, do government policies cut costs for the ruling class, or do they increase the squeeze on the public (like with new fines or taxes)?
4. Power of the Story: Do the official government messages inspire agreement or laughter in public conversation? How much do people trust what they are told?

By tracking these signs, you can estimate where the “Dynasty Train” is on its tracks—and how close it is to the end of the line.

The way the world economy works today, driven by a powerful manufacturing country (let’s call it “the Empire”), has created a stable situation where almost everyone seems to win, at least in the short term. Here’s a look at what each group gets out of this deal.

What the U.S. and Europe Get

• Lots of Cheap Stuff: A flood of inexpensive goods keeps prices low. This means people can easily afford things like clothes, phones, and TVs, which helps prevent inflation.
• Companies Make More Money: By using cheaper supply chains, big international companies can make products for less and sell them for a bigger profit, making their shareholders happy.
• Politicians Keep Their Jobs: When the economy (GDP) is growing and prices are stable, people are generally happier. This helps politicians avoid losing elections over economic problems.

What Poorer Countries in Africa and Latin America Get

• New Infrastructure: These countries get access to affordable projects like railways, roads, and power plants. They also get cheap consumer products, which helps their societies modernize faster.
• Better Standard of Living: Everyday people can now buy cheap phones, clothes, and appliances. In some ways, they get to skip certain difficult stages of industrial development.

What the Empire’s Elite Get

• More Government Money: Profits from global industries flow back to the Empire, building up huge amounts of money and foreign currency reserves for the government.
• Stable Power: By focusing on manufacturing and exporting goods, the ruling class keeps employment high and society stable, which helps them stay in power.
• Global Influence: The Empire becomes so essential to global manufacturing that other countries can’t easily replace it. This gives the Empire a sense of political security on the world stage.

What the Empire’s Working Class Gets

• A Better Life (Relatively): Even though they may be overworked, their income and living conditions are still much better than those of workers in places like Africa or India.
• A Sense of Pride: They get a feeling of identity and satisfaction from nationalistic slogans like “My country is amazing!,” “We are way ahead!,” and “The great rejuvenation of the Empire!”
• A Feeling of Purpose: Some may even feel like they are part of a grand historical mission, rather than just being used by the system.

How This Becomes a “Nash Equilibrium”

All of these interests combine to create a Nash Equilibrium. This is a concept from game theory where every player is making the best possible decision for themselves, based on what they think the other players will do. In this situation, no one has a reason to change their strategy on their own.

Here’s how it works:

• The U.S. and Europe won’t completely stop buying the Empire’s products because that would cause prices to skyrocket, people’s standard of living to fall, and politicians to lose elections.
• Poorer countries won’t refuse the Empire’s products because they would lose a cheap and easy path to modernization.
• The Empire won’t raise wages or benefits for its workers because that would eliminate its “cost advantage,” which is its ability to make things cheaper than anyone else.
• The Empire’s working class won’t rebel on a large scale because they don’t have the power to and are also comforted by the story of national greatness.

This creates a standoff where everyone stays in their current position, even if the system is based on inequality and exploitation. No single group can improve its situation by changing its strategy alone.

How the Empire Keeps This System Going

To keep this global system running, the Empire has to carefully manage four key areas:

1. Maintaining an Unbeatable “Cost Advantage”

This is the foundation of the whole system. To ensure the world remains dependent on its products, the Empire must keep its production costs lower than anyone else’s.

• Control Labor Costs: This means strictly limiting workers’ rights, preventing independent unions, and keeping wages low. The government also ensures there are always enough workers available to keep labor costs down.
• Control Resources: The government controls the price of land, energy, and loans to make sure factories can operate cheaply.
• Keep Society Stable: The Empire needs a system to ensure that its huge workforce can handle long hours and intense labor without causing major social unrest.

2. Managing the World’s Dependence

It’s not enough to be the cheapest; the Empire must make sure other countries need it.

• Become Essential to Supply Chains: The Empire aims to be the place where key parts are made and final products are assembled. This way, if the Empire stops working, the entire global supply chain could break down.
• Manage Relationships with Poorer Countries: The Empire binds poorer nations to it by funding their infrastructure and giving them loans, making their economies dependent.
• Divide the West: The Empire tries to create disagreements between countries like the U.S. and those in Europe to prevent them from forming a united front against it.

3. Ensuring Absolute Power at Home

To manage all this, the Empire needs total control over its own country and resources.

• Prevent Economic Crises: The Empire’s economy is built on debt and investment, which can lead to problems like a housing bubble. The government must use its power to manage these risks without letting the economy collapse.
• Keep Up with Technology: When other countries try to block its access to technology, the Empire must invest heavily in developing its own to remain irreplaceable in the global supply chain.
• Push a Powerful National Story: The government must constantly promote the idea that the sacrifices made by its people are necessary for “national rejuvenation.” By creating a sense of national pride, it gives the working class a psychological reward and makes them less likely to resist.

4. Keeping the Working Class “Just Happy Enough”

The workers are the fuel for this system, and the Empire must make sure that fuel doesn’t run out or explode.

• Allow for Slow Improvement: The lives of the workers must slowly but steadily get better. This “better than before” and “better than others” feeling is key to keeping them psychologically balanced.
• Prevent Organized Protests: The Empire uses technology and social controls to stop any organized resistance before it can start, keeping the workers isolated and unable to unite.
• Provide an Outlet for Anger: The government often stirs up nationalist feelings and directs public anger toward other countries (like the U.S. or Japan). This gives people a safe way to vent their frustrations without blaming their own leaders.

The System’s Weakness

Ultimately, whether this equilibrium can last forever depends on the Empire’s ability to maintain a delicate balance between these four pillars: cost advantage, external dependence, internal stability, and the tolerance of its working class. If any one of these pillars weakens, the entire system could come crashing down like a row of dominoes.

Deep Analysis of the Phenomenon: Why Do People Resist the Truth?

What you give them is the truth, but it is also harm. You think you are helping them understand society? You are simultaneously deeply wounding their foolish and fragile psyche. Resenting you and reacting against you is an inevitable physiological response.

1. The Sogdian Messenger Effect (The Bearer of Bad News Effect)

This ancient story accurately depicts a psychological mechanism: people subconsciously link bad news to the messenger who delivers it, generating negative emotions and projecting those emotions onto the messenger. In modern psychology, this is known as the “Shooting the Messenger Effect.” When you reveal a harsh social truth, even if you do so out of goodwill, the recipient may view you as the source of the pain, anxiety, or helplessness brought by that truth, thus developing hostility toward you.

2. Cognitive Dissonance

The theory of Cognitive Dissonance, proposed by psychologist Leon Festinger, is central to explaining this phenomenon. When new information received by people (e.g., “Social competition is much harsher than you imagine”) conflicts with their existing beliefs (e.g., “As long as I work hard, life will be wonderful”), it triggers a state of tension and discomfort. To alleviate this dissonance, people usually choose the easiest path, which is:

• Denying or Downplaying the New Information Source: “You are too extreme,” “You look at things too darkly.”
• Avoiding the New Information: Refusing to continue the discussion, changing the subject, or simply blocking you.
• Finding Justification for Existing Beliefs: Seeking out individual cases that support their optimistic view while ignoring general patterns.

Directly denying an unpleasant truth is far easier than reshaping one’s worldview.

3. Confirmation Bias & Emotional Reasoning

As Goleman observed, “The masses only have a superficial understanding of abstract ideas, so their reactions are often expressed in the emotional realm.” Humans are naturally inclined toward “Confirmation Bias”—we are more willing to seek out and believe information that confirms our existing ideas, while ignoring or rejecting contradictory evidence.

When the truth conflicts with a common person’s emotional needs (such as security, belonging, or self-esteem), emotion inevitably triumphs over reason. They are not “thinking” about the information you provide; they are “feeling” it. If this truth makes them feel bad, their brain automatically activates a defense mechanism, whose primary task is to eliminate that bad feeling, rather than seeking the truth itself.

4. The “Ostrich Mentality” & Psychological Defense Mechanisms

The ostrich burying its head in the sand is a classic metaphor for avoiding threats. In psychology, this is called the “Ostrich Effect,” a typical avoidance coping strategy. When an individual perceives a problem as too massive, too difficult to solve, or likely to cause immense pain, they selectively ignore it. When you point out that “they won’t think of any solutions,” this is the manifestation of the “Ostrich Mentality”—because thinking of a solution requires first acknowledging the problem’s existence and severity, and that acknowledgment itself is painful. Blaming you is essentially a psychological projection, transferring the helplessness and anger they feel toward the truth onto the person who revealed it.

Their primary need is to gain emotional security and validation, not a cold, even if correct, solution. Forcing a solution upon them is like giving a piece of ice to someone who just wants to warm up, even if that ice is priceless in another context.

Although Goleman’s theory originates from an evil background, it certainly reveals a side of mass psychology: emotion is the underlying code driving most people’s behavior. Your goal is not to manipulate the masses, but to interact with the people around you in a wiser, more compassionate way, while protecting yourself from being harmed by “honesty.”

This can be completely optimized by establishing an “Atomic Habit.” Below, we draw inspiration from the four laws of Atomic Habits to tailor a new habit for you called “Communication Mode Identification and Switching.”

Communication Mode Identification and Switching (The Empathy-First Switch)

Goal: In communication, prioritize identifying the other person’s emotional needs, resist the impulse to immediately provide a solution, thereby achieving more effective and harmonious exchange, and reserving energy for true “wise discussion.”

Law One: Make It Obvious - Setting Clear Cues

The Cue of the old habit is: [Friend/Colleague starts complaining or describing a problem to you]. This cue immediately triggers the “Analyze Problem $\rightarrow$ Find Cause $\rightarrow$ Provide Solution” loop in your brain.

We need to insert a new, tiny step between this cue and your ingrained reaction.

Action Plan:

1. Physical Anchor: When someone starts confiding in you, perform an inconspicuous physical action. For example:
   • Finger Tap: Lightly and consciously touch your thumb to the tip of your index finger.
   • Mutter FUCK: Imagine a thousand wild horses in your mind and silently mutter, “Another giant baby seeking emotional validation!”
   • Change Posture: Lean back slightly, instead of leaning forward. Leaning forward represents aggression and intervention; leaning back represents listening and acceptance.

This tiny action is your new cue, shouting at you: “Pause! This is Identification Mode, not Solution Mode!”

Law Two: Make It Attractive - Reshaping Your Desire

The Craving of the old habit is: [Experiencing your own wisdom and value by providing the optimal solution, gaining the satisfaction of “I got this”].

We need to make the craving for the new habit more appealing than the old one.

Action Plan:

1. Mindset Reframing: Shift the craving for “providing a solution” to the craving for “becoming a communication master.”
   • Tell yourself: “A true sage not only sees through the problem but also sees through the human heart. Right now, my challenge is not solving her problem, but understanding her needs. This is more advanced and more interesting than solving the problem itself.”
   • View the other person’s confession as a “Humanity Maze,” and your task is not to fly directly to the finish line, but to enjoy the fun of exploring the maze’s path. This makes “listening and empathizing” feel like a high-IQ challenge, not a compromise.
   • View “providing emotional value” as a rare and powerful ability; possessing it will stabilize your relationships and earn long-term trust.

Law Three: Make It Easy - Designing a Simple Response Flow

The Response of the old habit is: [Immediately starting to analyze: “I think the problem is…” or “You should…”].

We need to replace it with a simpler, less energy-intensive response. The core of this new response is “Questioning” rather than “Answering.”

Core Principle: Always assume the other person is seeking comfort unless they explicitly ask you for advice.

Action Steps:

1. Activate 100% Empathy Mode: Forget your analytical ability; your role is a warm “echo chamber.”
2. Use Empathy Phrases:
   • This sounds too difficult.
   • It’s really tough that you have to deal with this.
   • I can feel that you are truly disappointed/angry.
   • It sounds like you are really tired; I can sense this pressure.
   • This made you so sad; if it were me, I would be sad too.
   • Your emotions are completely understandable right now.
   • This isn’t your fault; anyone would feel wronged in this situation.
   • Just take it easy for a day or two; sadness is normal.
   • You have done really well; dealing with this is truly not easy.
   • I know you have been trying your best; don’t be too hard on yourself.
   • Others might have collapsed already; you are truly resilient.
   • I might not fully understand how you feel, but I want to try.
   • The outcome wasn’t what you wanted, but I see all the effort you put in.
   • Disappointment is inevitable, but you are not alone.
   • Some things are indeed unfair; it’s right that you are angry.
3. Resist! Resist! Resist! When the thought pops into your head, “Actually, she just needs to…” imagine a lock on your mouth, and the key is in the other person’s hand.
4. Identify the “Key”: The other person’s request for help is the key. For example:
   • “What do you think?”
   • “Do you have any good ideas?”
   • “I really don’t know what to do; help me.”
5. Acknowledge and Switch: When they give you the key, you can even confirm it: “Oh? You want to hear my thoughts? Okay, then I’ll tell you from my perspective, but it might not be right.” This gives the other person respect while also providing a buffer for the “hard truth” that follows.

Law Four: Make It Rewarding - Giving Yourself Immediate Rewards

The Reward of the old habit is: [Immediate intellectual superiority] (but often accompanied by subsequent interpersonal tension).

The new habit requires a healthier, more sustainable reward mechanism.

Action Plan:

1. Internal Reward:

   • Experience the calm and sense of control that comes from wisely not acting. This is a more mature form of pleasure.

2. External Tracking:

   • On a calendar or memo, draw a star or checkmark every time you successfully complete a “Communication Mode Switch.” This gives you a visual sense of progress and satisfaction. As the stars accumulate, you will feel proud of your own improvement.

Summary and Elevation

Abandon the Obsession with “Persuading,” Shift to the Art of “Guiding”

Wrap the sharpness of reason in the warmth of emotion; while revealing the problem, light a small lamp called “Hope and Action.” This is not just about getting along better with others; it is also about protecting ourselves—the messenger who does not want to be shot. By doing this, we may not change the world immediately, but at least we can quietly, little by little, let the light shine into more closed minds without causing unnecessary conflict.

You don’t have to abandon your profound insights, nor do you have to despair about the surrounding environment.

All you need to do is equip your “Dragon-slaying Blade” (profound insights and solutions) with a “Scabbard” (the ability to empathize and identify).

• For ordinary people, put on the scabbard first, and then see if you need to draw the blade. Providing emotional value is the first step in building trust and security. Once this trust is established, they are far more likely to be truly ready to listen to your profound wisdom at some point in the future.
• For the wise, you can be open and direct—draw the sword. This efficient communication becomes more precious and enjoyable because you save the energy that would otherwise be wasted elsewhere.

This new habit does not make you fake or abandon the truth; it teaches you to “say the right thing, to the right person, in the right way, at the right time.” This itself is a form of supreme wisdom. You are not burying your talent; you are using it in a more artistic and effective manner.

1. Phenomenon Overview

Through continuous observation of the Blue Star societal structure, a significant pattern has emerged: an individual’s physical survival capacity (defined as the ability to independently acquire resources, evade threats, and achieve goals) is inversely correlated with their reliance on the social construct of “friendship.”

• Low-Capacity Individuals: These individuals possess limited ability when facing survival challenges alone. They exhibit a strong need for “friendship,” compensating for their individual deficiencies by establishing reciprocal alliances (which they term “mutual help”). This alliance takes the form of resource sharing, emotional support, and joint defense, similar to the “grouping” strategy observed in many social species, such as the ant balls formed when ants cross a river.

• High-Capacity Individuals: As individual capacity increases, the dependence on these reciprocal alliances significantly decreases. They tend to act independently, utilizing their own resources (such as economic means or political power) to directly influence and control other individuals to achieve their goals, rather than seeking an equal “friendship.”

• Apex Individuals: Individuals situated at the top of the power structure—such as historical “emperors” or modern oligarchs—demonstrate a fundamental distrust of all social relationships. Their strategy is a combination of “utilization” and “prevention,” viewing all other individuals as usable tools, and eliminating them when those tools might threaten their own status (e.g., the frequent historical phenomenon of “purging meritorious officials”). They self-identify as “solitary” or “few,” which linguistically accurately reflects their state of existence.

2. Deconstruction of “Friendship”

Analyzing from a non-Blue Star perspective, what the Blue Star humans call “friendship,” along with its derived concepts like “virtue” and “nobility,” is essentially a highly optimized survival strategy centered on “exchange” and “contract.”

• Utilitarian Core: “Friendship” is a necessary measure adopted by low-capacity individuals in a resource-scarce environment. It is an informal mutual aid contract designed to increase the probability of survival for individuals within the alliance amidst fierce competitive survival struggles. Defining this behavior through linguistic rhetoric as “virtue” is an efficient social solidification mechanism; it enhances the stability of the contract and lowers the risk of betrayal, thereby boosting the overall survival advantage of the entire alliance. This is a classic case of packaging a survival strategy as a moral principle.

• Vulnerability and Benefit Threshold: The stability of this contract is directly related to a clear “benefit threshold.” The friendship contract is maintained when the potential gain (or avoided loss) is less than the cost required for betrayal (such as losing alliance support or facing retaliation). However, when a sufficiently large benefit appears, whose value exceeds the expected return of maintaining the friendship, the contract’s collapse becomes a high-probability event. Countless cases in historical databases confirm that whether it is material wealth, political status, or survival opportunity, as long as the temptation is great enough, the so-called “blood pact” will be easily torn. This indicates that the maintenance of “friendship” is fundamentally the result of a cost-benefit calculation.

3. The “Cheating” Phenomenon: Arbitrage of False Friendship

The observed phenomenon of “social acquaintances” or “feigned affection” can be understood as a form of “cheating” or “arbitrage” within this social system.

• Asymmetric Information Warfare: The cheater mimics the behavioral patterns of “genuine friendship,” sending false cooperation signals to enter a reciprocal alliance at a minimal cost.
• Unilateral Resource Extraction: Once inside the alliance, the cheater enjoys the benefits provided by the alliance (gaining information, resources, emotional support) but does not intend to, or rarely fulfills, their own mutual aid obligations.
• Low-Cost Exit: When the cheater is required to incur costs or when the alliance faces a crisis, they will unhesitatingly exit, even betraying the alliance to secure greater benefits.

The essence of this behavior is fraudulent arbitrage conducted in the “friendship” market, utilizing information asymmetry. This further confirms the nature of “friendship” as an exchange system.

4. Analysis from the Perspective of the Cosmic Jungle Law

Viewing Blue Star within the broader context of the Cosmic Jungle Law provides a clearer explanation for these social phenomena. The fundamental law of the cosmos is survival and expansion; there is no “morality” or “emotion” as defined by the Blue Star humans.

• The Principle of Energy Efficiency: The behavior of any life form aims to acquire the maximum amount of survival resources with the minimum energy expenditure.

  • The Strategy of the Weak: For the weak, “grouping” is the most efficient method of energy utilization. Through collaboration, they can accomplish survival tasks beyond individual capacity (such as joint hunting or defense) with a lower average individual energy consumption. “Friendship” is the complex manifestation of this strategy within an intelligent life society.
  • The Strategy of the Strong: For the strong, they already possess efficient energy capture capabilities. At this point, the marginal benefit of “collaboration” decreases, while the energy cost of managing the collaborative relationship (preventing betrayal, resolving disputes) increases. Therefore, the strategy most aligned with the principle of energy efficiency is to abandon equal “friendship” in favor of direct “control” and “utilization,” which maximizes the reduction of uncontrollable factors.

• The Principle of Absolute Safety: In the cosmos, there are no eternal allies, only eternal self-interest. Any external force, no matter how “friendly” it appears at the moment, can transform into a threat under specific conditions.

  • The Inevitable Solitude of Apex Individuals: The predator at the top of the food chain faces its greatest threat from its own kind. Therefore, the apex individuals on Blue Star (emperors, dictators) distrust everyone, which is an inevitable choice based on survival logic. They must manage all potential competitors as threats, and the closest “allies” (meritorious officials, comrades-in-arms) are often the potential competitors closest in strength and the greatest threat. Thus, “purging meritorious officials” is not an emotional or moral issue, but a rational operation to eliminate potential threats and ensure absolute self-safety.

5. Conclusion

The “friendship” cherished by the Blue Star humans is not a transcendent spiritual quality, but rather an efficient, pragmatic, yet fragile survival tool that has evolved for their species to cope with individual capacity deficiencies at a specific evolutionary stage. It is imbued with the aura of “virtue” through complex cultural and linguistic packaging to enhance its stability.

However, its underlying logic always adheres to the brutal Cosmic Jungle Law:

1. Inverse Correlation: The stronger the individual capacity, the lower the dependence on this primitive mutual aid tool.
2. Interest Driven: The establishment, maintenance, and dissolution of relationships are entirely dependent on real-time cost-benefit calculations.
3. Power Law: When power reaches a certain degree, direct control supersedes equal cooperation as the superior survival strategy.
4. Absolute Solitude: The ultimate pursuit of absolute safety inevitably leads to severing all uncontrollable, equal links—that is, moving toward a state of “solitary existence.”

• Niche Down: Don’t try to build a platform; build a “plugin,” “tool,” or “solution.”
• Prioritize Automation and SaaS: Pursue subscription-based, self-running Software as a Service (SaaS) to achieve “passive income.”
• Lean Asset Operation: Stay away from models that require heavy operations, customer service, and physical inventory.
• AI Empowerment: In today’s 2025, AI is your most powerful “lever” as an individual developer, allowing you to accomplish the work of a past team by yourself.

10 Psychological Codes

1. Money Driven by Male Desire

• Psychological Code: Procreation instinct, pursuit of attraction, display of social status.
• Business Logic: This is not limited to the sex industry; it is more broadly reflected in social apps, high-end cars, luxury watches, fitness, and fashion. All goods that enhance male charm and status utilize this primal drive.

2. Money for Female Aesthetics

• Psychological Code: Pursuit of social recognition, enhancement of self-worth, combating aging anxiety.
• Business Logic: From skincare and cosmetics to aesthetic medicine and fashion jewelry, this is an inexhaustible market. It is deeply tied to women’s psychological satisfaction, creating infinite consumption demand by promising “more beauty.”

3. Money for the Poor to Get Rich Quickly

• Psychological Code: Extreme desire to change destiny, fantasy of a “shortcut,” psychological tendency toward luck/chance.
• Business Logic: Lottery, gambling, high-risk financial derivatives, certain pyramid schemes… They are selling not goods, but the dream of “getting rich overnight.” The allure of this dream is so great that it can move even the most rational people.

4. Money for the Rich Who Fear Death

• Psychological Code: Ultimate fear of life and health, and the safeguarding of existing wealth and status.
• Business Logic: When wealth reaches a certain level, life becomes the most precious asset. This drives ultra-expensive medical services, life extension technology, high-end health supplements, and comprehensive security services. This is an “infinite budget” market where the customer is not price-sensitive.

5. Money for Children’s Education

• Psychological Code: Parental love, anxiety over class mobility, uncertainty about the future.
• Business Logic: The phrase, “You can’t let your child lose at the starting line,” unlocks a trillion-dollar market. From school district housing to private schools, and various tutoring and extracurricular classes, parents are willing to give everything for their children’s future. This is a consumption driven by a mix of love and anxiety, making it almost impossible to refuse.

6. Money for Elderly Health

• Psychological Code: Thirst for quality of life, fear of aging and illness, desire for extended lifespan.
• Business Logic: With global aging, the potential of this market is increasingly evident. Health supplements, medical devices, specialized drugs, elderly care services… everything that can alleviate pain and improve the quality of life in old age has massive and rigid demand.

7. Money for the Lazy Who Want Convenience (The Currency of Convenience)

• Psychological Code: Pursuit of comfort, avoidance of complexity, exchanging money for time.
• Business Logic: Food delivery platforms, ride-hailing services, pre-made meals, various home services… The massive success of modern commerce is largely built upon “making the user lazier.” By providing extreme convenience, merchants can charge substantial premiums and make consumers dependent.

8. Money for the Respectable Who Want Recognition (The Currency of Status and Virtue)

• Psychological Code: Desire to be respected and recognized, demonstrating identity, taste, and moral stance through consumption.
• Business Logic: This is divided into two levels. First, displaying “I am wealthy” through luxury goods, mansions, and high-end cars; second, displaying “I am kind” by purchasing eco-friendly products and supporting ethical brands. Whether it is material ostentation or moral superiority, people are willing to pay a high “status tax” for it.

9. Money for the Bored Who Want Entertainment (The Currency of Escapism)

• Psychological Code: Countering mediocrity, seeking stimulation, filling spiritual emptiness.
• Business Logic: Games, short videos, live stream tipping, idol economy… These industries are masters at designing addictive “flow” experiences and instant feedback mechanisms. They create a virtual world where one can escape reality, making users willingly invest time and money.

10. Money for the Ordinary Person Who Wants Peace of Mind (The Currency of Security)

• Psychological Code: Seeking a feeling of stability and control in a world full of uncertainty.
• Business Logic: From insurance, financial products, to cybersecurity, data storage, and home security, all businesses selling “security” are thriving. Merchants accurately meet people’s desire for certainty by moderately amplifying potential risks and then offering so-called “solutions.”

“Don’t be the loudest sheep, and don’t be the fattest sheep.”

I. Recognize the Essence: Don’t be the “Awakened and Angry Sheep”

• Anger is for the shepherd to see; ultimately, there are only two outcomes:

  1. Being slaughtered → Establishing dominance (or authority)
  2. Being penned → Being drained (or exploited)

• Many “awakened sheep” simply become “negative examples for display.”

→ Strategy: Remain low-key, be clear-headed internally, be unassuming externally, and avoid becoming the “leader sheep.”

II. Reduce the Degree of Harvesting: Hide Your Wool

• You provide a little bit of wool, pretending to be “dutiful,” but the real wool must be hidden where “others cannot see it.”

• Specific real-world equivalents:

  • Diversified income streams (not relying on a single pasture)
  • Asset relocation or secretive investments
  • Skill reserves (not being in a role that can be replaced at any time)
  • Mental independence (not participating in the self-destructive competition within the flock)

→ Strategy: “I may not be the richest sheep, but I live freer than you.”

III. Establish the “Sheep’s Secret Passage”: Be the Sheep with a Backdoor

• Historically, the sheep that lived comfortably were always " amphibious": → On the surface, they are sheep, but they quietly dig a tunnel behind the scenes.

  • Tech immigration
  • Overseas accounts
  • Digital identity
  • On-chain assets

→ Strategy: Never expose your entire self within the pasture system.

IV. Avoid Internal Competition and Mutual Harm: Don’t help the shepherd bite other sheep

• The most basic sheep like to step on others to lift themselves up, competing to be the “leader sheep.”
• In reality, this only gives the shepherd another handle to grab, and eventually, they are slaughtered anyway.
• Truly smart sheep signal to each other, form invisible small groups, share secret resources, and refrain from reporting each other.

→ Strategy: Maintain tacit understanding among the sheep, and try to unite with “like-minded awakened sheep,” but without exposure.

Summary:

“Be the sheep that looks ordinary, contributes moderately, is calm internally, and has an escape route.”

“While others are engaging in internal competition and mutual harm to become the ’leader sheep,’ I have already dug a small path leading to another pasture in the back hills.”

You might know this feeling:

When you were around 18, you saw this one thing—maybe it was a perfect dress in a shop, or those must-have sneakers everyone was talking about. It felt like everything. But you checked the price, checked your bank account, and had to walk away. You told yourself, “I’ll get it later when I have real money.”

Fast-forward to 30. You’re crushing it, you have a solid job, and buying that thing is now easy. You can finally get it! But when you put it on, it feels… off. The style is not your style anymore. Your whole vibe has changed. That dream item doesn’t fit the real you.

A lot of people use this story to tell you: “See? YOLO! Buy it now! If you wait, you’ll regret it later!”

That advice sounds good, but it’s only half the story.

🛑 Trap #1: The Endless ‘Whac-A-Mole’ of Wants

Let’s keep it real.

Do you think regret only happens at 18? Nope. At 30, you might be stressed about a down payment on a house, or that big trip you can’t afford yet. You tell yourself, “I’ll save up for it once I get a raise.”

When you’re 60, you might easily buy that expensive thing you wanted at 30, but by then, you might be focused on your grandkids or your health, and that thing just… won’t matter.

The lesson? If you just wait to “own” something later, you often end up with “regret at the wrong time.”

But is Instant Gratification—buying it right away—the answer? Hard pass.

Even if you bought that dream item at 18, how long would the excitement last? A few weeks? Two months? Soon, you’d want the next cool thing, then the next. Until one day, you’d find another thing you couldn’t afford yet. The original problem—that feeling of “I need this to be happy”—would just come back in a different outfit at every age.

Buying everything right now is an endless game of Whac-A-Mole. You hit one desire down, and two more pop up. You’re always chasing, always running, and the result isn’t happiness—it’s just being drained and tired from a desire overdose.

✅ The Real Point: Stop Chasing Things, Start Chasing Why

We’re stuck: Give in, feel empty. Hold back, feel regret.

The real issue is we try to solve our desires but never try to understand them. Desire is just natural energy. It’s not good or bad; it just flows and changes.

The goal isn’t to crush desire, but to learn how to master it. Go from being a slave led by your wants to the master who sees and controls them.

🛠️ Your Action Plan: Becoming the Desire Master

How do you start? You switch your role from being a chaser to a detective and a coach.

1. 🔍 Observe and Decode: What Are You REALLY Buying?

When you feel a strong “I NEED this!” moment, don’t act on it right away. Hit pause and look at it like a scientist.

• Acknowledge it: “Okay, I seriously want this. That’s a real feeling.”
• Ask the Deeper Questions: “What am I actually liking? Is it the design, or is it the feeling it promises—like feeling more confident, more popular, or part of a certain lifestyle I want?”

When you can clearly answer why you want it, you turn a vague, powerful urge into something you can analyze and manage.

2. 🌱 Find the Root: Trade “Having It” for “Becoming That Person”

If your answer is, “It makes me feel more confident,” congratulations! You just found your true goal. Now, the problem is no longer, “How do I buy this dress?” but, “What are the best ways to become a more confident person, besides just buying something?”

• Hit the gym or a sport for a stronger body?
• Focus on your studies or a project to build real skills and achievements?
• Learn something new that makes you feel knowledgeable and smart?

The confidence you get from doing these things is way stronger and lasts way longer than what any piece of clothing can give you. At this point, that “must-have” item becomes a “nice-to-have” option. Whether you buy it or not, your inner strength is already set.

3. 🗺️ Set Priorities: Make Your Wants Work for Your Values

You have limited stuff: money, time, and energy. A smart person knows how to put those limited resources into what matters most to them.

• Quick Check: What’s most important to me right now? Is it short-term shopping fun, or a big long-term goal? Is it an expensive buy, or a valuable learning experience (like a course, or saving for travel)?

When your values are clear, you have a solid ruler for all your wants. Many things that used to stress you out suddenly look lame next to your true life goals. You’ll willingly pass up easy temptations for a bigger dream (like saving for college, starting your own thing, or focusing on friends/family), feeling sure and in control, not held back.

4. 🥇 Practice “Smart Satisfaction,” Redefine Winning

This doesn’t mean you can’t want anything. It means you have the freedom to choose what you want and when.

• Invest Selectively: For the things you truly love and value—like a music interest, a specific hobby, or a personal tool—feel free to invest seriously. A gamer gets way more lasting joy from a top-tier headset than from 10 cheap impulse buys. Put your money where it brings you lasting skill and growth.
• Earn the Delay: At 18, if you still want that dress, work a few hours a week for it. This “delay” becomes a chance for growth. When you buy it with your own hard-earned cash, it means more than just an item; it’s a badge of your effort and ability.

🚀 Take Back Your Freedom

Let’s go back to being 18.

The person who’s mastered their desires sees that expensive item and calmly makes a choice: they either turn it into an inspiring goal to work toward, fueling their growth; or they smile and let it go, choosing to put their money/time into something more meaningful to their core self.

Whatever they pick, they are active and calm.

At 30, they can afford it. They might buy it as a fun throwback memory, or they might just laugh, because the feeling of “being better” that item symbolized is already a solid part of their life, built through real effort. No regrets.

Real freedom isn’t having the cash to buy every cool thing in the world. It’s the quiet power of not being controlled by the thought of needing to own any of them.

When you get this, no matter what trends are in the window, your life will always be perfectly and uniquely you.

I. Entrepreneurship no longer requires a “grand setup”

• In the Past: Entrepreneurship required investors, co-founders, an office, and several months of financial support.
• Now: These are no longer necessities. As long as you have the internet and some basic tools, one person can start.

II. Every step of entrepreneurship has a solution

• Need ideas? Mine inspiration from Reddit and app store reviews.
• Need customers? Attract users by building a personal brand or community.
• Need to develop a product? Quickly build software using tools like Bolt, Cursor, Replit, Lovable.
• Need to get paid? Stripe Link helps you easily handle payments.
• Need to promote your product? Collaborate with niche creators and leverage their trust for promotion.
• Need to optimize operations? Use AI tools like GPT-4o, Claude, Gumloop to achieve automation.
• Need an office space? A kitchen table at home + noise-canceling headphones is enough.
• Need advice? Listen to podcasts, or contact experts directly on social media.
• Need to get started? Start with small projects and learn as you go.

III. The barrier to entrepreneurship is almost zero

• No restrictions: No need for gatekeepers, resumes, or licenses.
• Key elements: Only persistence, taste (or vision), and an internet connection are needed.
• Learning opportunities: Entrepreneurial knowledge is available anytime (like a “24/7 open school”), and it’s free, but the real “tuition” is action—you must do it.

IV. Core Message: Action is Key

Today’s entrepreneurs have unprecedented resources and opportunities, leaving no excuse not to start. The key to success lies in:

• Act immediately: Start with small projects and accumulate experience.
• Continuous effort: Persistence and learning are the path to success.

Registering the Developer Account

First, I registered a developer account.

Deploying Cloudflare

Then, I deployed Cloudflare.

Adding Gemini Support

Finally, added Gemini support.

0402 In-App Purchase Channel Integration

Integrating the In-App Purchase Channel

Next, I integrated the in-app purchase channel.

0403 AI Unit Refactoring

Refactoring the AI Unit

I refactored the entire AI unit.

0404 Market Review and Modification

Submitting for Market Review

Finally submitted for market review.

Review Feedback and Modification

The review was sent back, requiring further modifications.

0405

Created a support page Deleted all subscription-related features

0406

Added debugging symbols Added a text editor

0412

After a week of tinkering, it was finally listed on the app market and achieved two sales. I view this as a brand new start, meaning a new revenue stream has been opened up 🥳🥳🥳

TODO

Quora promotion Could consider adding small cards to the desktop Trying out the small cards, seems there are still difficulties

0415

Today was truly a crazy day. With the boost of AI, I pushed myself to the limit, writing 6,000 lines of code in one day. Of course, most of it was written (by the AI), and I was responsible for the review. The photo album management section was implemented in one day.

Speculation is a zero-sum game—my lessons in speculation

The essence of reducing trading frequency

Investment vs. Speculation in “Enough”

Market Sentiment is Random

The market is essentially like a person with average intelligence. You might occasionally guess the market’s sentiment, but to make money, you need to guess correctly twice (the buying point + the selling point). And if you guess wrong just once, you lose money. This is a very simple mathematical problem.

Some Forces Want You to Trade Short-Term

There are always stories that make you want to trade short-term for quick money. This is similar to seeing news about a major lottery win—it is essentially an advertisement. This is because securities firms, exchanges, and tax authorities all like you to trade quickly and repeatedly. They are leveraging the greed in your nature to entice you into these speculative operations.

Never Make Investment Decisions Under Strong Emotion

Never make investment decisions under strong emotion. Whether that emotion is fear, excitement, sadness, or greed and impulse, they act like a fog obscuring rational judgment.

• When the market crashes sharply, the adrenaline-fueled fear might cause you to sell quality assets at a bargain price;
• During bull market euphoria, the dopamine-driven excitement easily tempts you to buy at high prices. Even sudden sad events in life can act like an invisible filter, distorting your perception of the risk-reward ratio. True investment wisdom lies in establishing a decision-making mechanism that is insulated from emotional fluctuations—replacing ad-hoc judgment with pre-set trading discipline, and hedging against human weakness with data-supported valuation models.

Pre-Checklist for Stock Market Operations

• Asset Allocation: Investors set the proportions of different asset classes (such as stocks, bonds, cash, etc.) based on their risk tolerance and return objectives.
• Market Volatility: Market fluctuations can cause asset proportions to deviate from the target, for example, a rise in stocks might make their share in the portfolio too high.
• Rebalancing: Adjusting the portfolio back to the target proportions by buying and selling assets.

2. Methods of Rebalancing

• Time-based Rebalancing: Adjusting the portfolio at fixed time intervals (e.g., quarterly or annually).
• Threshold Rebalancing: Adjusting when a specific asset class deviates from the target proportion by more than a certain threshold (e.g., 5%).

3. Advantages of Rebalancing

• Risk Control: Prevents a single asset from becoming overly dominant, thereby reducing risk.
• Discipline: Avoids emotional decision-making and maintains the stability of the investment strategy.
• Return Optimization: May enhance long-term returns by buying low and selling high.

4. Disadvantages of Rebalancing

• Transaction Costs: Frequent adjustments may increase trading fees.
• Tax Implications: In taxable accounts, rebalancing may generate capital gains tax.
• Market Trends: In a unidirectional market, rebalancing may reduce returns.

5. Implementation of Rebalancing

• Determine Target Proportions: Setting asset allocation based on risk preference.
• Monitor the Portfolio: Regularly checking asset proportions.
• Execute Adjustments: Restoring target proportions by buying and selling assets.

Summary

Rebalancing is a tool that “exchanges short-term transaction costs for long-term risk control,” making it suitable for sideways or sector rotation markets, but potentially incurring opportunity costs in unidirectional trending markets. When executing, it is recommended to combine threshold rules (e.g., rebalancing after a 10% deviation) rather than operating mechanically by time. Furthermore, it is suggested to perform adjustments no more than twice a year.

Seven Mindsets Leading to Erroneous Decisions

Many people possess enough talent to analyze data, but few can deeply observe things and withstand the powerful influence of the psychological aspect. In other words, many people will reach similar conclusions based on their own analysis, but due to different psychological influences, they will take drastically different actions based on those conclusions. The biggest investment bias does not come from information or analysis, but from mindset.

Greed

Greed is defined as “excessive or exhaustive desire, and usually a reprehensible possessiveness, especially regarding wealth or profit.”

Greed is an extremely powerful force. Its power is so great that it can override common sense, risk aversion, caution, logic, the memory of past painful lessons, determination, panic, and other elements that allow investors to avoid trouble. Furthermore, greed occasionally causes investors to join the crowd chasing profits, only to pay the price later.

Fear

Fear, just like greed, means excess. Therefore, fear is more like panic. Fear is an excessive worry that causes investors to remain inactive when they should be taking positive action.

Self-Deception

Nothing is easier than self-deception, because everyone, as long as they wish it, will believe it is true. Investors are always looking for a panacea, calling it the “Holy Grail” or “free lunch,” but everyone wants a ticket that turns them into a wealthy person without taking risks. Few question whether this ticket exists, or why they should receive it. Most importantly, the average person always holds onto hope.

What factors make people believe in a panacea?

1. First, there is usually a factual basis.
2. Next, a set of seemingly intelligent theories is fabricated, which believers promote everywhere to convince others. Subsequently, this theory accidentally generates profits, either because the theory has some value or simply because new believers join to buy and push up the price of the target asset. Finally, it appears that there is truly a way to gain wealth, and this creates a craze.

Conformity (Herd Mentality)

Not sticking to one’s own opinion, even if the crowd’s view is obviously absurd. Time and again, the pressure of conformity and the desire to get rich cause people to abandon independent judgment and skepticism, suppressing their innate risk-averse mindset to believe in unreasonable things. Since this situation occurs so regularly, something must be at work, rather than a random influence.

Envy

Even if the power of greed is negative, it at least always motivates people to strive for more profit. But the negative influence of comparing oneself to others is even stronger. This is what we consider the most dangerous characteristic of human nature.

A person who might be happy when isolated from the world feels miserable when they see others doing better. In the investment world, you will find that most investors find it difficult to sit by and watch others earn more money than them.

Hubris (Overconfidence)

Facing the following practical situations, maintaining objectivity and careful calculation is actually a huge challenge:

1. We evaluate and compare short-term investment performance.
2. During a bull market, making an inappropriate, even reckless, decision to increase risk often brings the best returns (and most of the time, it is a bull market).
3. The best returns bring the greatest reward to oneself. When things go right, feeling smart and having others agree with it is a very pleasant thing.

In contrast, thoughtful investors work diligently, earning stable returns during a bull market and losing less than others during a bear market. They avoid high-risk behavior because they know there are many things they don’t understand, and they suppress their hubristic mindset. In my view, this is the best formula for long-term wealth creation, but it cannot satisfy the hubristic mindset in the short term. Emphasizing humility, caution, and risk control is not a glamorous path, and of course, investing shouldn’t seek glamour, but that’s what people often think.

Capitulation (Surrender Mentality)

This is an investment behavior that is consistently seen in the later stages of a cycle. Investors try their best to stick to their beliefs, but when they cannot resist economic or psychological pressure, they surrender and follow the trend. Often, asset prices are too high and continue to rise, or the price is too low and continues to fall. Eventually, these trends shake the investor’s mindset, beliefs, and determination. Others profit from the stock you refused to buy, while the stock you chose to buy hovers at a low price every day. Furthermore, the investment concept you originally thought was unsafe and unwise, as the high-priced stock continues to rise or the low-priced stock continues to fall, should make it easier to do the right thing—selling the overpriced stock and buying the underpriced stock—but investors do not do this. The tendency toward self-doubt, mixed with news of others’ success, forms a powerful force that makes investors do the wrong thing, and the longer this trend lasts, the stronger the force becomes. This is another influence factor that we must resist.

The correct way to say it should be that, in order to attract capital, high-risk investments must offer higher potential returns, higher guaranteed returns, or higher expected returns, but this absolutely does not mean that higher potential returns will definitely be realized.

1. Risk only exists in the future, and we cannot know exactly what the future will hold… When we look back at the past, the fact is clear: we know that something happened. But this certainty does not mean that the process that produced the result was clear and reliable. In every past situation, many things could have happened. But because only one thing happened, we underestimate the existence of variability.
2. When deciding whether or not to take on risk, I first assume that the normal situation will repeat itself. Although the normal situation does occur most of the time, sometimes something very different happens… Occasionally, rare things also happen.
3. Our predictions usually revolve around historical normality, making only small changes at most… The key point is that the average person usually predicts that the future will resemble the past, and underestimates the possibility of change.
4. We have heard many predictions of “worst-case scenarios,” but the results are often worse. Let me tell you about my father’s story. He was a gambler who often lost money. One day, he heard that a horse race only had one horse entering, so he bet his rent money. However, halfway through the race, the horse jumped over the rail and ran away. Things always turn out worse than the average person expects. Perhaps “worst-case scenario” means “the worst case we have seen so far,” but it doesn’t mean it is the worst case of the future. The situation in 2007 was much worse than many people assumed for the worst case.
5. Risk changes. If we say there is a “2% mortgage default rate” every year, even if the average figure over many years is true, there is still a possibility that at some point, an abnormally large number of defaults will occur, dragging down the performance of structured financial instruments. Some investors, especially those using high leverage, cannot get through this difficult time.
6. The average person tends to overestimate their ability to measure risk, and also overestimates their ability to understand investment mechanisms they have never seen before. Theoretically, what makes humans different from other species is that we can point out that something is dangerous without having to experience it ourselves. We don’t need to burn ourselves to know that we shouldn’t sit on the stove. But in a bull market, this mechanism often fails to operate. The average person doesn’t first understand the risk; instead, they tend to overestimate their ability to understand new financial products.
7. Finally, and most importantly, most people believe that taking on risk is the main way to make money, and enduring high risk usually brings high rewards. The market must be arranged to make it look like this, otherwise, the average person won’t participate in high-risk investments. But the market won’t operate this way forever, otherwise, high-risk investments wouldn’t be high-risk. It is only when taking on risk does not bring the desired result that people realize that this investment method truly doesn’t work, and they remember what risk actually is.

No one can comfortably face a loss. Eventually, everyone starts to wonder: “Maybe I’m wrong; the market is right.” The most dangerous moment is when they begin to speculate: “It has fallen too much; I better get rid of it before it becomes wallpaper.” This is the mindset that leads to market bottoms… and triggers frenzied selling pressure.

In a falling market, there are two fundamental elements to profiting: you must have your own view on the intrinsic value, and you must remain steadfast, bravely buying even when the price drop suggests you are wrong. Oh, and there is a third element: your view must be correct.

Daily Meal Plan Template (Can be flexibly substituted based on ingredients)

Breakfast (400kcal)

• 1/2 Cranberry Bagel (200kcal)
• Boiled Eggs ×2 (140kcal)
• Unsweetened Black Coffee/Green Tea Nutritional Focus: Bagel provides fast carbs to kickstart metabolism; egg protein extends satiety

Morning Snack (100kcal)

• Skim Milk 200ml + 1/2 Apple (sliced)

Lunch (500kcal)

• Pan-fried Chicken Breast 150g (180kcal)
• Mixed Grain Rice 100g (raw weight, approx. 120kcal)
• Olive Oil Stir-fried Seasonal Vegetables (Broccoli + Carrot + Shiitake Mushroom) 200g (200kcal) Cooking TIP: Marinate chicken breast beforehand with cooking wine + black pepper; cut vegetables into chunks and stir-fry quickly over high heat

Afternoon Snack (100kcal)

• Greek Yogurt 100g + 1/2 Banana

Dinner (400kcal)

• Clear-stewed Beef 150g (210kcal)
• Steamed Pumpkin 200g (80kcal)
• Cold Spinach Salad (Sesame Oil + Vinegar) 150g (110kcal) Meal Prep Tip: Use an electric pressure cooker to batch-cook and portion/freeze the beef

Key Execution Strategies

1. Bagel Optimization: Portion and freeze whole bagels, taking 1/4 each time paired with protein (e.g., egg/cheese)
2. Meat Prep: Marinate all on the weekend (chicken with lemon juice + rosemary, beef with ginger slices + star anise), portion and refrigerate
3. Anti-Hunger Tips: Drink 300ml of warm water before meals; eating order: Vegetables → Protein → Carbs
4. Metabolic Boost: Drink 2L of water daily (can add lemon slices), 3 times a week, 20 minutes of strength training (push-ups/squats)

Common Problem Solutions

Q: What to eat when working overtime? → Prepare emergency meals: Ready-to-eat chicken breast + tomato + 1/4 bagel (Total calories < 300kcal)

Q: What if you want a snack? → Make beef jerky yourself using an air fryer (150g raw beef → 60g jerky, approx. 180kcal)

Q: Breaking through a plateau → Schedule 1 day of carb cycling every 10 days (intake increased to 1800kcal)

After executing this plan for 4 weeks, it is recommended to monitor changes using a body fat scale. For sedentary groups of programmers, it is suggested to get up every hour and do 1 minute of high knee exercises to promote abdominal fat metabolism.

.debug remote namedpipe \.\pipe\HyperDbgPipe

.debug prepare serial 115200 com1

.sympath SRVc:\Symbolshttps://msdl.microsoft.com/download/symbols

.sym download .sym reload

.process list

.thread list process 0000000015e2b000

change process

.process list .process pid 1394 g

when the debugger stop, the use .process to check the process

1. App Store Pricing Strategy

• List the high price of $99.99/year upon listing (never actually discounted)
• Product description emphasizes “Enterprise-Grade Service” and “Original Price for Institutional Procurement Only”
• Feature list uses B2B terminology such as “Enterprise Security Solution” and “Million-Level Data Processing”

2. Cognitive Framework Shift

• Publish a “User Benefit Upgrade Announcement” on the official website/social media:
• “To celebrate users reaching 100,000, we are temporarily opening the free personal channel (Original Price $99.99 → 0 Yuan)”
• Set a countdown timer: Display remaining free slots (dynamic fake data, always maintaining <10% availability)

II. Zero-Price Trigger Design (Dual-Channel Loss Aversion)

1. Registration Code Acquisition Mechanism

• Design a “Golden Invitation Code” system:
• Unlock Enterprise Edition features valued at $99.99 (limited to individual users) Set up a dual loss framework: ✅ Claim Now → Receive VIP privileges valued at $99.99 (Permanent) ❌ Decline Claim → Lose the maximum annual benefit (Red text warning)

2. Sunk Cost Implantation

• Obtaining the invitation code requires completing three steps:
  1. Enter phone number to receive verification code (Initiating commitment consistency)
  2. Watch a 15-second product video (Attention sinking)
  3. Select three interest tags (Personalized anchoring)

III. Social Currency Creation (Viral Spread Engine)

1. Vanity Sharing Design

• Automatically generate a “Digital Asset Report” after successful registration:
• “You have saved $99.99, surpassing 92% of users”
• The sharing page includes:
• Dynamic Ranking Bar: “Your free code is valued by over XX people”
• Virtual Badge: “Savvy Decision Maker,” “0 Yuan Challenge Success”

2. Group Behavior Stimulation

• Create a “Limited-Time Free Alliance” leaderboard:
• Invite 1 person to earn a “Credit Star,” which can be exchanged for an extension of the free period.
• The top 100 display real user avatars, triggering competitive psychology.

IV. Scarcity Maintenance System (Dynamic Fake Resources)

1. Multi-Dimensional Scarcity Prompts

• Geo-fencing technology: “Only 43 free slots remain in Chaoyang District, Beijing where you are located.”
• Device identification prompt: “iOS user exclusive quota is about to run out.”
• Ghost Inventory Strategy: Real-time display of “Users Currently Claiming”:

Example Algorithm (Actual data must be faked to appear real)

import random
current_users = random.randint(87, 92) # Always display 90% claim rate
remaining = 1000 - current_users

V. Neural Reward Circuit Construction (Dopamine Pulse System)

1. Unscheduled Surprise Rewards

• Trigger a “Gold Coin Rain” animation when the user first opens the APP.
• Randomly drop tangible rewards (requires completing a specified action to claim): “Congratulations! Invite 1 more person to redeem a Starbucks coupon.”
• “Click to Claim: Free 3-day extension of premium features.”

2. Progress Bar Addiction Design

• Personal Center sets up “Privilege Unlock Progress”: 2% progress bar increase upon daily login.
• When reaching 80%, prompt: “Free qualification is about to be lost, invite a friend immediately to freeze progress.”

VI. Behavioral Trace Conversion (Endowment Effect Activation)

1. Virtual Asset Accumulation

• Automatically create a “Personal Data Center” for the user.
• Even if not actively used, it generates: “We have analyzed 1,302 potential connections for you.”
• “3 important schedules detected awaiting activation.”

2. Loss Visualization Reminders

• Push notification triggered after three days of inactivity: “Your free benefits are flowing away! Accumulated value of $8.33 unused.”
• Coupled with virtual currency visualization: “Account Balance: $99.99 → Log in now to stop the loss.”

VII. Moral License Gateway (Cognitive Dissonance Elimination)

1. Legitimacy Endorsement Construction

• Add to the bottom of the registration page: “For every free code claimed, we donate 1 minute of digital education to mountainous regions.”

2. Decision Rationalization Messaging Confirmation Pop-up Design:

3. “You are making a wise choice:

4. ✔ Saving $99.99 in personal expenses

5. ✔ Supporting the cause of educational equity

6. ✔ Joining the 100,000 Elite Community”

Synergistic Strategy (Enhanced Effect Combination Punch)

1. Cross-Platform Cognitive Bombardment

• Create a post on Zhihu (a Chinese Q&A platform): “What is the experience of claiming XX free codes?”
• Initiate a “Free Code Exchange” pseudo-user topic on Douban Group.
• Layout keywords on WeChat Search: “How to get XX Golden Invitation Code.”

2. Physical World Touchpoints

• Distribute “Free Code Coffee Cup Sleeves” at coffee chains.
• Set up “Scan Code Free Print” terminals in university towns.
• Partner with parcel lockers to pop up ads: “Collect items and claim digital benefits for free.”

Through this comprehensive plan, you will create a self-reinforcing behavioral magnetic field: Zero-Price Trigger for initial acquisition → Social Display for secondary spread → Fake Scarcity for urgent action → Neural Rewards for sustained participation. The key is maintaining the state of “High Value - Zero Cost” cognitive imbalance, keeping the rational evaluation system constantly suppressed.

The vast majority of financial planners do not genuinely care about your interests, no matter how friendly and kind they appear to be on the surface.

To stay financially safe, we must accumulate assets, not liabilities. The safest way to ensure lifelong security is to spend less and earn more, and then invest the remaining money rationally.

No matter how high a person’s salary is, if they cannot still live comfortably and pleasantly when they lose their job, it only proves that they are not truly wealthy.

At a minimum, one should meet the following two criteria to be considered “wealthy”:

• They have the option to not work and do not have to worry about making a living.
• Their investments, pension funds, or trusts can guarantee a return that is double the average income of a middle-income family in their country for life.

In the pursuit of wealth and the realization of financial independence, many people make a foolish mistake: they enjoy creating the illusion that they look rich, rather than becoming truly wealthy.

The best way to achieve diversification in a stock portfolio is to find a low-fee index fund.

They absolutely cannot beat the market; that simply will not happen.

Kahneman discovered through his research that human instinctive behavior negatively affects investment decisions, and he received the Nobel Prize precisely for this study. He believes that many people feel that as long as excellent fund managers are given enough time, they will be able to beat the market index.

You know when a mall is having a discount sale, so why wouldn’t you rush to buy when stocks are at “jump-off-building” prices?

Stock investing inevitably requires some luck, but in the long run, good luck and bad luck cancel each other out. To achieve sustained success, one must rely on skill and good principles.

Maintaining rationality secures an average return of 10%.

The stock market is like a manic little dog; you never know where it will run.

The simplest way to build a rational and diversified investment account is to utilize stock and bond index funds.

However, when the stock market enters an accelerating upward phase, everyone becomes ecstatic and obsessed with the profits brought by rising stock prices. At this time, most people disregard their bonds (if they hold them) and buy more stocks with all their might. Even many financial advisors become victims of this temptation. But this practice of setting aside the predetermined stock-to-bond allocation is precisely paving the road to disaster for themselves.

When you hold a stock market index fund, you actually possess something as real and reliable as the ground beneath your feet.

When manic investors meet manic stocks, a bubble appears.

Those who ignore the stock market “Bible” that states “profit growth is directly related to stock price growth” will ultimately lose everything.

The stock market after the “9/11” event was precisely the opposite of the stock market at the end of the 1990s. Although stock prices dropped like football-sized hail, corporate profits were hardly affected.

Many investors do not accept the fact that the stock market represents corporate profits. Fear and greed determine that the stock market is irrational in the short term. However, viewing the stock market as a collection of businesses benefits you in accumulating wealth. When corporate profits decouple from stock prices, that is your opportunity to get rich. The stock market after the “9/11” event was precisely the opposite of the stock market at the end of the 1990s. Although stock prices dropped like football-sized hail, corporate profits were hardly affected.

When the “Stock Market Sale” happens, rush to buy!

When the stock market reopened after “9/11,” where did I gather the money to “mass purchase”? I sold some of the bonds I held.

Most people still fail to fully utilize the wealth-creating opportunities created by short-term market dips. However, financial television channels relentlessly spread news of an impending financial collapse, the economic situation appears exceptionally difficult due to continuous deterioration, and the internet fearlessly publishes pessimistic market news. The combination of sensational media publicity and harsh reality forces us to face the most volatile stock market of the past decade. Unfortunately, most people easily surrender to the greedy, fearful self in the mirror. They like to buy when the market rises, but they hesitate when they see a discounted bargain.

As for the future, the only thing certain is this: we are destined to face unpredictable market volatility again. The market will either crash like a falling cliff or shoot straight into the sky like a rocket. But as long as we recognize that the stock market inevitably reflects corporate profits, we will not succumb to temptation and bear foolish risks, nor will we panic when the market falls. A rational and balanced stock-bond portfolio not only makes our investment account more solid and stable, but more importantly, it allows us to use the irrationality permeating the stock market to our advantage.

Highly attractive, desirable. Short-term bonds: Find a safe harbor for your money.

Short-term bonds: Find a safe harbor for your money.

The higher the interest paid by a corporate bond, the higher the associated risk.

When the stock market encounters a crisis, bonds may become the secret weapon protecting your wealth.

If a 30-year-old investor’s portfolio holds 30% in bonds and 70% in stocks, their goal should be to maintain this ratio. If the stock market plummets in a given month, the investor will find that the stock proportion in their portfolio is below the initially set 70%. In that case, when adding funds to the investment account, they should add the funds into stock index funds.

1. Agenda-Setting Theory

Proponents: Maxwell McCombs and Donald Shaw
Core Idea: Media influences the public’s ranking of issue importance by selecting and emphasizing certain topics.
Explanation: What the media reports, the public tends to focus on. For example, if the media constantly reports on climate change, people may perceive climate change as one of the most important current issues.

2. Spiral of Silence Theory

Proponents: Elisabeth Noelle-Neumann
Core Idea: People fear being isolated for expressing minority views, so they choose to remain silent, causing the mainstream views to become stronger.
Explanation: In a social setting, if someone supports an unpopular policy, they might choose not to express their opinion due to fear of being ridiculed or excluded.

3. Uses and Gratifications Theory

Proponents: Elihu Katz et al.
Core Idea: Audiences actively choose media to satisfy their needs, such as obtaining information, entertainment, or building social connections.
Explanation: For example, some watch the news to get current affairs information, while others scroll through short videos for relaxation and entertainment.

4. Two-Step Flow of Communication Theory

Proponents: Paul Lazarsfeld et al.
Core Idea: Information first influences Opinion Leaders, and then it is passed on to ordinary people through them.
Explanation: A celebrity (Opinion Leader) shares their view on a certain brand of mobile phone, and fans may consequently be more inclined to purchase that brand’s phone.

5. Media Dependency Theory

Proponents: Sandra Ball-Rokeach and Melvin DeFleur
Core Idea: The degree of dependency people have on the media determines the media’s influence on them.
Explanation: During a natural disaster, people rely more heavily on news media for information, significantly enhancing the media’s influence.

6. Cultivation Theory

Proponents: George Gerbner
Core Idea: Long-term exposure to a certain type of media content influences people’s worldview, leading to a distorted perception of the real world.
Explanation: If someone watches violent movies for a long time, they might perceive the real world as more violent than it actually is.

7. Framing Theory

Proponents: Erving Goffman et al.
Core Idea: The media shapes how audiences understand events through specific organizational and presentation methods.
Explanation: For example, the same protest event can be presented by the media using two different frames—“peaceful demonstration” or “violent conflict”—leading to vastly different audience interpretations.

8. Diffusion of Innovations Theory

Proponents: Everett Rogers
Core Idea: The diffusion of innovation occurs in different stages, influenced by early adopters, social networks, and cultural background.
Explanation: After a new smartwatch is launched, early adopters purchase and use it first, subsequently influencing their friends and family to join the purchasing line.

9. Media Ecology Theory

Proponents: Marshall McLuhan et al.
Core Idea: Media, as a technological form of information transmission, profoundly influences society, culture, and behavior.
Explanation: McLuhan’s “The medium is the message” suggests that different media forms themselves shape people’s communication methods and thought habits; for instance, the TV era emphasizes visual expression, while the book era emphasizes textual logic.

10. Cultural Hegemony Theory

Proponents: Antonio Gramsci
Core Idea: Through cultural transmission, the social elite can maintain control over ideology.
Explanation: Mainstream films and TV programs often consolidate existing social values through narrative, such as promoting individual striving and consumerism.

11. Knowledge Gap Theory

Proponents: Philip Tichenor et al.
Core Idea: Information disseminated by the media often exacerbates the information gap between high-knowledge and low-knowledge groups.
Explanation: For example, the dissemination of scientific news might allow educated people to understand related knowledge better, while those with lower education levels may become even more unfamiliar with these topics.

12. Third-Person Effect Theory

Proponents: W. Phillips Davison
Core Idea: People tend to believe that the influence of media content on others is greater than on themselves, and thus take certain actions in response.
Explanation: For example, some believe that advertisements strongly influence others’ purchasing decisions but have little impact on themselves, leading them to advocate for stricter regulation of advertising.

13. The Strength of Weak Ties Theory

Proponents: Mark Granovetter
Core Idea: In social networks, “weak ties” (acquaintanceship) are more effective than “strong ties” (close ties) in spreading information and facilitating resource flow.
Explanation: An ordinary friend might provide you with important job-seeking information because the information they encounter is different from your circle, whereas close friends usually share similar information with you.

14. Double Reality Theory

Proponents: Nikki K. R. Kroeber et al.
Core Idea: Media reports often construct the relationship between reality (the content presented by the media) and social reality (what people actually experience) simultaneously.
Explanation: For example, people perceive a high crime rate from media reports, yet they rarely encounter crime directly in their own daily lives.

15. Gap Model of Information Seeking

Proponents: Robert S. Taylor
Core Idea: Information seeking behavior originates from the “information gap” between a perceived problem and current knowledge.
Explanation: When someone learns that a company might go bankrupt but doesn’t know the specific reasons, they may actively search for relevant information to bridge this gap.

16. Media Richness Theory

Proponents: Richard L. Daft and Robert H. Lengel
Core Idea: Different media possess varying degrees of information richness, and complex information requires transmission through rich media.
Explanation: Face-to-face interaction is the richest medium, while written text is relatively poor; therefore, complex negotiations are better suited for face-to-face formats than email.

17. Social Comparison Theory

Proponents: Leon Festinger
Core Idea: People evaluate their own opinions and abilities by comparing themselves to others, and the media intensifies this comparison.
Explanation: On social media, after seeing others’ successful lives (such as vacation photos), people might feel that they are not as successful or happy.

18. Uses and Dependency Model

Proponents: Sandra Ball-Rokeach and Melvin DeFleur
Core Idea: The influence of the media depends on the individual’s degree of dependency on media information and the strength of the social system.
Explanation: During a large-scale internet outage, people’s dependency on social media may reveal critical vulnerabilities within the communication system.

19. Selective Exposure Theory

Proponents: Joseph Klapper
Core Idea: People tend to select media information that aligns with their existing views while avoiding contradictory information.
Explanation: A political preference might cause supporters of a certain party to more frequently watch news channels consistent with their party’s stance.

20. Fourth Estate Theory

Proponents: Edmund Burke
Core Idea: The media, as an independent social institution, plays the role of supervising and balancing power.
Explanation: Investigative journalism that exposes government corruption or corporate misconduct embodies the media’s role as the “Fourth Estate.”

21. Perceptual Filter Theory

Proponents: Harold Lasswell
Core Idea: During the process of information dissemination, people’s background, preferences, and experiences influence how they receive and understand information.
Explanation: The same piece of news might be interpreted as a positive signal by optimists, while pessimists might view it as a negative warning.

22. Information Overload Theory

Proponents: Alvin Toffler
Core Idea: When information exceeds human processing capacity, it can lead to decision difficulty, decreased efficiency, and even anxiety.
Explanation: When shopping on an e-commerce platform and faced with hundreds of similar products, people may find it harder to make a purchasing decision.

23. Media Logic Theory

Proponents: David Altheide and Robert Snow
Core Idea: The presentation style and logic of the media profoundly influence society’s ways of thinking and behavioral patterns.
Explanation: TV programs often use an entertainment logic, which causes news reporting to tend toward attracting viewers through entertainment rather than deep analysis.

Let’s dive into some insightful quotes about investing and what they truly mean.

Understanding the Essence of Returns

The gross return generated in the financial markets, minus the costs of the financial system, equals the net return actually delivered to investors.

公司的总收益就是投资者的收益

This sentence clearly reveals the source and distribution of returns. The total return generated by the financial market must ultimately deduct the various costs of the financial system; what remains is what the investor truly receives. This is like a cake: the more people who slice it, the less each person gets.

The more the financial system takes, the less the investor makes.

桌子拿走的越多，投资者收益越少

This sentence is a natural extension of the previous one. The costs of the financial system, such as trading commissions, management fees, etc., directly erode the investor’s returns. This also reminds us that choosing a low-cost investment method is crucial in the long run.

The Long-Term Logic of the Market

“The most that owners in the aggregate can earn between now and Judgment Day is what their business in the aggregate earns.”

投资者只能拿到市场的平均收益

This sentence is very profound, revealing that the ultimate source of investor returns is corporate profitability. In the long run, the aggregate return of all investors cannot exceed the overall earning capacity of all businesses. This also means that instead of trying to beat the market, it is better to choose to grow together with excellent companies.

“When the stock temporarily over-performs or under-performs the business, a limited number of shareholders—either sellers or buyers—receive out-sized benefits at the expense of those they trade with. [But] over time, the aggregate gains made by Berkshire shareholders must of necessity match the business gains of the company.”

投资者只能短时的影响收益

This sentence explains the nature of short-term market fluctuations. In the short term, stock prices may deviate from their intrinsic value due to various factors, allowing a small number of traders to gain excess returns or incur losses, but this is merely a transfer of wealth. In the long run, the returns of shareholders in companies like Berkshire Hathaway must inevitably match the growth of their business.

“In the short run the stock market is a voting machine . . . [but] in the long run it is a weighing machine.”

市场最终是一个称重机

This is a famous quote by Benjamin Graham, vividly illustrating the short-term and long-term characteristics of the market. In the short term, the market acts like a voting machine, influenced by emotions and various short-term factors; but in the long run, the market eventually returns to rationality, acting like a weighing machine that reflects the company’s true value.

“the aggregate gains made by Berkshire shareholders must of necessity match the business gains of the company,”

吹出来的泡沫终会破灭

This sentence once again emphasizes the fundamental principle of value investing. Short-term speculation can create bubbles, but ultimately, the company’s value determines the long-term direction of its stock price. Bubbles detached from fundamentals will eventually burst.

The Trap of Speculation

A simple example demonstrates that speculation is a loser’s game. Assume that one-half of the shares of each of the 500 S& P stocks are held by investors who don’t trade at all, and the other half are held by speculators who trade solely with one another. By definition, the investors as a group will capture the gross return of the index; the speculators as a group will capture, because of their trading costs, only the (lower) net return. The obvious conclusion: investors win; speculators lose. There is no way around it. So the orgy of speculation we are witnessing today ill serves our market participants. It serves only Wall Street.

交易成本的存在，使得投机者的收益必然低于投资者。假设有两个投机者相互交易，而投资者长期持有资产不动。显然，两个投机者的总收益将小于投资者的总收益。

This example clearly illustrates the drawbacks of speculation. Even assuming the speculators have comparable trading skills, due to the existence of trading costs, their overall returns will inevitably be lower than those of long-term investors. Frequent trading only benefits the brokerage firm.

whenever stock prices lose touch with corporate values and bubbles begin to form, too many market participants seem to anticipate that values will soon rise to justify prices, instead of the other way around.

投机者的 wishful thinking. 他们认为公司的价值很快就会提升，以适应被他们吹胀的泡沫

This is a deep analysis of the speculator’s psychology. When price detaches from value, the rational approach is to believe that the price will revert to its value, but speculators often harbor a hopeful mindset, believing that value will catch up to the inflated price. This is a dangerous “wishful thinking” mindset.

the only swans we humans have ever observed are white doesn’t mean that no black swans exist. For evidence, look no further than the Black Monday I just mentioned.

黑天鹅罕见，且无法避免

This sentence reminds us that the market contains unpredictable “Black Swan” events. Past experience does not guarantee the future; even if we haven’t seen a Black Swan, we cannot deny its existence. Risk always exists, so we must remain vigilant.

Long-Term Focus and Simplicity

American capitalism has demonstrated remarkable resilience, plugging along steadily even as times change, driving growth in earnings and paying dividends that have risen apace over time, in step with our growing economy.

这是目前版本的答案

This sentence expresses confidence in the long-term positive trend of the US economy and capital markets. Although there will be fluctuations, in the long run, economic growth drives corporate profitability and investor returns. This is the cornerstone of long-term investing.

“opportunities and risks will appear and disappear in short order.” I agree with that proposition. But human emotions and behavioral flaws militate against our capitalizing on them. Count me as one who simply doesn’t believe that market timing works.

永远不要 Timing The Market

The market changes rapidly, and opportunities and risks coexist. However, human greed and fear often lead us to make wrong decisions. Trying to precisely predict the market timing is almost impossible.

It is difficult enough to make even one timing decision correctly. But you have to be right twice.

连续猜对两次的概率很低

Even if you successfully predict one market turning point, you need to predict another to truly profit. The probability of being correct twice in a row is very low, which further illustrates the difficulty of market timing.

For me, simplicity has always been the key to successful investing, and the time-honored wisdom of Occam’s razor,

大道至简

Successful investing often follows simple principles. Occam’s razor tells us: unless necessary, do not multiply entities. Choosing a simple and easy-to-understand investment strategy makes it easier to stick with and achieve success.

Wall Street’s perennial advice to its clients:“ Don’t just stand there. Do something!”

券商总是希望你高频率交易

“Don’t do something. Just stand there,”

要我说:别动!看戏就好

These two sentences form a sharp contrast. Brokerages encourage frequent trading to earn commissions, while rational investors should remain patient and avoid unnecessary trading. “Don’t move! Just watch the show” is a vivid expression of long-term value investing.

The Importance of Self-Responsibility

Managers of other people’s money [rarely] watch over it with the same anxious vigilance with which . . . they watch over their own . . . they very easily give themselves a dispensation. Negligence and profusion must always prevail.

只有你自己才能对自己的事情真正上心

People who manage other people’s money are often less cautious than those who manage their own. This is not intentional, but a result of human nature. Therefore, regarding one’s own investments, we must take responsibility and treat them seriously.

“Once you decide whether you expect to be in business for a short time or a long time, most of the right decisions are easy.”

知道方向选择就很简单

Once you determine that your investment goal is long-term, many decisions become simple. You will focus more on the company’s fundamentals rather than short-term price fluctuations.

Conclusion

These quotes all point to a core idea: successful investing is based on long-term judgment of corporate value, not short-term market speculation. Understanding the costs of the financial system, avoiding unnecessary trading, maintaining patience and simplicity, is the right path to wealth growth. I hope these thoughts can help us avoid detours on the path of investing and ultimately achieve our financial goals.

This blog post summarizes key insights from the provided quotes, emphasizing the importance of long-term value investing over short-term speculation. It highlights the costs associated with the financial system, the difficulty of market timing, and the inherent logic of the market where long-term returns are tied to business performance. The core message is to focus on simplicity, avoid unnecessary trading, and be responsible for your own financial decisions.

The Essence of Newspeak

Language Controls Thought: The core of Newspeak in 1984 lies in limiting people’s ability to express complex ideas by simplifying language. For instance, by eliminating the word “freedom,” it becomes difficult to discuss the concept of “intellectual freedom.” Silent Control: Instead of explicit violence, control is exerted through subtle, gradual linguistic manipulation, making independent thought progressively impossible.

Common Newspeak

Stock Market

• Stock Market Decline $\rightarrow$ Technical Adjustment / Pullback / Healthy Correction / Value Reversion (Emphasizing that the decline is a normal phenomenon, even a positive signal, rather than a crisis.)
• Stock Crash $\rightarrow$ Severe Market Volatility / Irrational Selling / Systemic Risk Release (Downplaying the destructive nature of the crash, attempting to describe it as a temporary phenomenon.)
• Plummet / Steep Drop $\rightarrow$ Significant Adjustment / Market Digestion / Emotional Fluctuation (Softening the panic associated with a steep drop, attempting to lend it rationality.)
• Bear Market $\rightarrow$ Structural Trend / Low-Level Oscillation / Market Bubble Burst Phase (Avoiding the direct admission of a generally sluggish market state.)
• Tightening Regulation $\rightarrow$ Regulatory Optimization / Standardizing Market Order / Perfecting Rules (Emphasizing the positive meaning of the policy, reducing resistance to market intervention.)
• Policy Headwind $\rightarrow$ Short-Term Disturbance / Policy Implementation Effect / Adjustment Period Pain (Weakening the negative impact of policy on the market.)
• Market Support Action $\rightarrow$ Maintaining Market Stability / Injecting Liquidity / Enhancing Investor Confidence (Avoiding direct mention of human intervention, highlighting stability.)
• Corporate Loss $\rightarrow$ Phase Pressure / Financial Structure Optimization / Temporary Loss (Downplaying the severity of the loss, emphasizing future improvement potential.)
• Company Bankruptcy $\rightarrow$ Voluntary Market Exit / Strategic Contraction / Business Integration Failure (Softening the negative association brought by company failure.)
• Stock Price Surge $\rightarrow$ Receiving Market Attention / High Investor Sentiment / Value Reassessment (Avoiding mention of speculation or bubble formation, attempting to lend it rationality.)
• High-Risk Investment $\rightarrow$ High-Return Potential Investment / Growth-Oriented Asset (Blurring the trade-off between risk and return, emphasizing potential gains.)
• Speculation $\rightarrow$ Short-Term Trading / Flexible Investment Strategy / Capturing Market Opportunities (Using more neutral language to describe high-risk, high-volatility operations.)
• Hype / Speculative Frenzy $\rightarrow$ Market Hotspot Attention / Thematic Investment Opportunity (Avoiding direct criticism of speculative behavior, giving it an investment meaning.)
• Market Overheating $\rightarrow$ Increased Activity / High Market Sentiment / Ample Capital (Weakening the risk of a market bubble, highlighting a positive atmosphere.)
• Liquidity Crisis $\rightarrow$ Temporary Tightening of Liquidity / Capital Pressure / Short-Term Liquidity Challenge (Describing the crisis as a short-term phenomenon, lowering the sense of urgency.)
• Market Bubble $\rightarrow$ Irrational Prosperity / High Valuation / Excessively High Prices (Avoiding direct admission that a market bubble exists.)
• Panic $\rightarrow$ Emotional Fluctuation / Irrational Behavior / Short-Term Pressure Release (Describing panic as a controllable market phenomenon.)
• Confidence Collapse $\rightarrow$ Increased Investor Wait-and-See Sentiment / Temporary Confidence Setback (Weakening the severe consequences of market confidence collapse.)
• Index Decline $\rightarrow$ Short-Term Adjustment / Oscillating Downtrend / Valuation Correction (Describing it as normal market fluctuation, not a crisis signal.)
• Index Breach $\rightarrow$ Technical Descent / Phase Low Point / Support Level Test (Avoiding the negative implication of a key index breach, highlighting technical analysis.)

Advertising

• Expensive $\rightarrow$ Premium Price / High-End Positioning / Choice of Value / Tailor-made for You (Emphasizing scarcity and high quality, downplaying the obstacle presented by the price.)
• Cheap $\rightarrow$ Entry-Level / Super Value Selection / Excellent Cost-Performance Ratio / Easy to Own (Downplaying the cheapness, emphasizing value.)
• Inferior Quality $\rightarrow$ Selected Material (though quality may be average) / Lightweight Design (may imply lack of durability) / Minimalist Style (may imply simple materials) / Cost Optimization (Using seemingly neutral words to mask quality issues.)
• Outdated $\rightarrow$ Classic Heritage / Retro Style / Nostalgic Choice / Tribute to Classics (Describing obsolescence as a style or sentiment.)
• Insufficient Functionality $\rightarrow$ Focus on Core Functions / Lightweight Design / Meets Basic Needs / Future Potential (Weakening the inconvenience caused by missing functions.)
• Knock-off / Imitation $\rightarrow$ Inspired By / Integrated Innovation / Borrowing Classic Elements / Tribute to Master Design (Beautifying the act of copying.)
• Waiting in Line $\rightarrow$ Anticipation Before Exclusive Experience / Popular Choice / Explosive Popularity / Requires Time for Craftsmanship (Describing waiting as positive anticipation or a guarantee of quality.)
• Poor Service Attitude $\rightarrow$ Focus on Efficiency / Personalized Service (May imply lack of enthusiasm or patience) / Direct and Honest** (May imply a stiff attitude)
• Difficult Refund $\rightarrow$ Requires Review Process / After-Sales Policy Explanation / Ensuring Your Rights / Not Supported Under Specific Circumstances (Complicating the process to mask the refund obstacle.)
• False Advertising $\rightarrow$ To Better Convey Product Concept / Copywriting Requires Understanding / Image for Reference Only / Final Interpretation Rights Reserved by the Store (Providing excuses for untrue promotion.)
• Forced Consumption $\rightarrow$ Providing More Comprehensive Service / Package Purchase is More Affordable / Exclusive Member Privilege (Packaging forced behavior as a discount or privilege.)
• Bundled Sales $\rightarrow$ Combination Discount / Package is More Affordable / Providing One-Stop Solution (Masking the fact of bundled sales.)
• High Sugar Content $\rightarrow$ Sweet Taste / Rich Texture / Provides Energy / Classic Formula (Emphasizing taste and energy, weakening the health risk.)
• High Fat $\rightarrow$ Rich Flavor / Deep Taste / Provides Satisfaction / Traditional Craftsmanship (Emphasizing taste, shifting focus from health.)
• Many Additives $\rightarrow$ Scientific Ratio / Enhancing Flavor / Extending Shelf Life / Complies with National Standards (Explaining the use of additives through science or compliance.)
• Not Fresh $\rightarrow$ Made on the Day (though may not be) / Cold Chain Transport / Vacuum Packaging / Locking in Freshness (Attempting to imply freshness through process description.)
• Small Portion $\rightarrow$ Exquisite and Compact / Light Meal Choice / Meets Moderate Needs / Avoiding Waste (Describing small quantity as healthy or waste-reducing.)
• Remote Location $\rightarrow$ Tranquil Living / Away from the Hustle / Beautiful Natural Environment / Huge Future Development Potential (Converting the geographical disadvantage into an advantage.)
• High Noise $\rightarrow$ Rich Living Atmosphere / Full of Vitality / Convenient Transportation (Describing noise as the cost of living convenience.)
• Small Space $\rightarrow$ Cozy and Comfortable / Compact Layout / Fully Functional / Small but Beautiful (Weakening the inconvenience caused by lack of space.)
• Fast Depreciation $\rightarrow$ Good Market Liquidity / Convenient for Replacement/Upgrade / Keeping Pace with Trends (Describing depreciation as easy to update.)
• Outdated Technology $\rightarrow$ Mature and Stable / Time-Tested / Strong Compatibility / Classic Design (Describing obsolescence as reliable or compatible.)
• Small Storage Space $\rightarrow$ Lightweight and Portable / Cloud Storage / Focus on Core Functions / Good Enough (Weakening the limitations caused by insufficient storage.)
• Short Battery Life $\rightarrow$ Fast Charging / Reflects High Performance / Lightweight Design Trade-off / Meets Daily Needs (Finding reasons for short battery life.)

Finance and Investment

• Deflation $\rightarrow$ Rational Price Return / Demand-Side Momentum Needs Stimulation / Structural Supply-Demand Adjustment / Economic Endogenous Recovery Period / Consumer-Friendly Price Environment (Emphasizing the rationality of price decline or viewing it as a phase of economic adjustment, even interpreting it positively from the consumer’s perspective.)
• Mass Factory Closures $\rightarrow$ Inevitable Stage of Industrial Structure Optimization and Upgrade / Clearing of Partial Traditional Capacity / Reallocation and Integration of Production Factors / Incubation Period of New Economic Momentum / Natural Selection of Market Entities (Viewing factory closures as an inevitable result of economic structural adjustment, even a positive “optimization” and “upgrade” process, emphasizing “natural” market mechanisms.)
• Financial Crisis $\rightarrow$ Market Correction / Systemic Risk Event / Liquidity Tightness / Cyclical Economic Fluctuation (Using more technical or cyclical terms to soften the severity of the crisis.)
• Stock Market Plunge $\rightarrow$ Market Oscillation / Valuation Adjustment / Investor Sentiment Fluctuation / Risk Release (Weakening the sense of panic and loss.)
• Inflation $\rightarrow$ Structural Price Increase / Demand-Pull Inflation / Input-Driven Inflation / Mild Inflation (Explaining inflation through different types, sometimes softening its negative impact.)
• Currency Depreciation $\rightarrow$ Exchange Rate Adjustment / Flexible Monetary Policy Response / Enhancing Export Competitiveness (Emphasizing the positive aspect or policy adjustment.)
• Debt Default $\rightarrow$ Technical Default / Credit Event / Debt Restructuring / Liquidity Challenge (Avoiding words with a sense of failure.)
• Speculative Bubble $\rightarrow$ Market Overheating / Irrational Prosperity / High Asset Prices / Existing Risk (Weakening the potential danger of the bubble bursting.)
• Rising Unemployment Rate $\rightarrow$ Prominent Structural Contradictions in Employment / Mismatch Between Labor Supply and Demand / Expanding Unemployed Population / Pain of Economic Transition (Attributing unemployment to structural issues rather than overall economic condition.)
• Wage Decrease $\rightarrow$ Compensation Optimization Adjustment / Reflection of Performance Assessment / Return to Industry Wage Level / Slowdown in Income Growth (Explaining wage cuts using more technical or performance-related terms.)
• Labor Shortage $\rightarrow$ Talent Gap / Insufficient Supply of Skilled Labor / Structural Contradiction in Labor Utilization / Human Resource Allocation Challenge (Emphasizing it is a talent issue rather than a working condition or wage issue.)
• Overtime $\rightarrow$ Flexible Work System / Voluntary Dedication / Project Breakthrough Phase / Efficient Task Completion (Beautifying unpaid or mandatory overtime.)
• High Work Pressure $\rightarrow$ High-Intensity Work Challenge / Need to Improve Resilience / Normal in Fast-Developing Industries / Opportunity for Personal Growth (Turning negative pressure into a positive challenge or opportunity.)
• Trade War $\rightarrow$ Trade Friction / Trade Dispute / Disagreement to be Resolved Through Dialogue and Negotiation / Global Value Chain Adjustment (Weakening the conflict’s confrontation and potential danger.)
• Trade Deficit $\rightarrow$ Structural Trade Imbalance / Strong Consumer Demand / Need for Industrial Structure Upgrade (Explaining the negative result as a structural or positive factor.)
• Dumping $\rightarrow$ Low-Price Competition Strategy / Expanding Market Share / Short-Term Promotional Behavior (Softening its nature as unfair competition.)
• Intellectual Property Theft $\rightarrow$ Technological Imitation / Industrial Learning and Borrowing / Existing Compliance Risk (Weakening the illegality and moral issue of theft.)
• Monopoly Profit $\rightarrow$ Return from Economies of Scale / Manifestation of Technological Leading Advantage / Reasonable Profit of Market Leaders (Defending monopolistic behavior with seemingly reasonable explanations.)
• Economic Recession $\rightarrow$ Economic Downturn / Slowdown in Economic Growth / Entering Adjustment Period / Facing Challenges (Avoiding words with negative emotional connotations.)
• Economic Overheating $\rightarrow$ Economic Operation in a High Range / Good Development Momentum but Requires Risk Attention / High Investment Enthusiasm (Softening potential bubbles and risks.)
• Fiscal Deficit $\rightarrow$ Proactive Fiscal Policy / Expanding Effective Investment / Necessary Input for Economic Development / Building Up Strength for Future Development (Emphasizing the positive use of the deficit.)
• Government Intervention $\rightarrow$ Macroeconomic Regulation / Policy Guidance / Optimizing Business Environment / Playing a Proactive Role for the Government (Describing intervention as positive guidance and optimization.)
• SOE Loss $\rightarrow$ Bearing Social Responsibility / Strategic Investment Period / Need for Further Deepening of Reform / Optimization of Asset-Liability Structure (Weakening the meaning of poor operation.)
• Technological Barrier $\rightarrow$ Technological Threshold / Industry Entry Requirement / Need to Increase R&D Investment / Manifestation of Leading Advantage (Describing competition restriction as a natural technical threshold.)
• Data Abuse $\rightarrow$ User Profile Analysis / Precision Marketing / Personalized Recommendation / Enhancing User Experience (Emphasizing the positive use of data, ignoring privacy infringement.)
• Algorithmic Discrimination $\rightarrow$ Model Bias / Need for Further Algorithm Optimization / Technology is Not Yet Perfect (Weakening the responsibility and moral issue of discrimination.)
• Digital Divide $\rightarrow$ Information Infrastructure Needs Improvement / Digital Skill Popularization Needs Improvement / Manifestation of Uneven Development (Describing inequality as a developmental stage issue.)
• Automated Layoffs $\rightarrow$ Intelligent Transformation / Job Upgrade / Human Resource Structure Optimization / Enhancing Production Efficiency (Masking the negative impact of layoffs.)

Business and Technology

• Loss $\rightarrow$ Negative Growth / Profit Adjustment / Strategic Loss (Emphasizing it is a strategic action rather than poor operation.)
• Debt $\rightarrow$ Leverage / Optimizing Capital Structure / Financial Tool (Packaging it with technical terms, softening the negative meaning.)
• Bankruptcy $\rightarrow$ Restructuring / Business Adjustment / Entering Protection Procedure (Avoiding words with a sense of failure.)
• Budget Cut $\rightarrow$ Resource Optimization Allocation / Cost Control / Efficiency Improvement Plan (Emphasizing positive management behavior.)
• Sales Decline $\rightarrow$ Growth Slowdown / Entering Plateau Phase / Strategic Adjustment Period (Avoiding direct admission of failure.)
• Inventory Accumulation $\rightarrow$ Goods Available for Sale / Strategic Reserve / Supply Chain Optimization Potential (Weakening the meaning of stagnation.)
• Price Increase $\rightarrow$ Value Enhancement / Price Adjustment / Optimizing Pricing Strategy (Emphasizing value enhancement rather than simple price hike.)
• Sales Revenue Decrease $\rightarrow$ Weak Demand / Market Adjustment / Conversion Rate Needs Improvement (Attributing the problem to external factors or process rather than the result.)
• Product Stagnation $\rightarrow$ Market Feedback Needs Verification / Product Iteration Space / Insufficient User Awareness (Weakening the product’s inherent problem.)
• Customer Complaint $\rightarrow$ User Feedback / Customer Care / Continuous Service Optimization (Turning negative feedback into an opportunity for improvement.)
• Loss of Market Share $\rightarrow$ Intensifying Competition / Market Structure Change / Expanding New Business Lines (Explaining it as external factors or strategic adjustment.)
• False Advertising $\rightarrow$ Information Transmission Deviation / Content Needs Improvement / To Better Convey Value (Softening the nature of deception.)
• Executive Dismissal $\rightarrow$ Management Change / High-Level Personnel Adjustment / Seeking New Development Opportunities (Avoiding direct dismissal terms.)
• Low Employee Morale $\rightarrow$ Team Atmosphere Needs Improvement / Organizational Culture Building / Needs More Positive Motivation (Softening negative emotions.)
• Salary Reduction $\rightarrow$ Performance-Linked Adjustment / Compensation Structure Optimization / Alignment with Market (Emphasizing correlation with performance or market.)
• Recruitment Difficulty $\rightarrow$ Talent Acquisition Challenge / Attracting Excellent Talent / Enhancing Employer Brand Influence (Attributing the problem to external factors or a required effort.)
• System Failure $\rightarrow$ Service Interruption / Encountering Technical Challenges / System Under Maintenance/Upgrade (Using neutral or positive terms to describe the problem.)
• Bug $\rightarrow$ Known Issue / Pending Resolution / Flaw Requiring Fix (Weakening the negative impact of the error.)
• Plagiarism $\rightarrow$ Borrowing / Innovative Reference / Source of Inspiration (Beautifying the unethical behavior.)
• Product Obsolescence $\rightarrow$ Technological Iteration / Product Upgrade/Replacement / Entering End of Life Cycle (Emphasizing natural development laws rather than failure.)
• Function Missing $\rightarrow$ Future Version Planning / Under Development / Pending Feature (Softening the current product’s deficiency.)
• Violation $\rightarrow$ Compliance Risk Event / Internal Process Needs Improvement / Need to Strengthen Risk Control (Using technical terms to describe illegal behavior.)
• Environmental Pollution $\rightarrow$ Environmental Impact / Need to Further Improve Environmental Standards / Green Development Investment (Weakening the severity of the pollution.)
• Labor Dispute $\rightarrow$ Employee Relations Need Further Maintenance / Building Harmonious Labor Relations / Communication Mechanism Needs Improvement (Softening conflict.)
• Bribery/Accepting Bribes $\rightarrow$ Improper Competitive Behavior / Integrity Risk / Need to Strengthen Professional Ethics (Using abstract concepts to describe criminal behavior.)

Daily Work

• Didn’t Understand $\rightarrow$ Information Reception Deviation / Needs Further Clarification / My Understanding May Not Be Adequate (Avoiding admitting lack of understanding, appearing proactive.)
• Not Important / Meaningless $\rightarrow$ Not Currently a Priority / Needs Further Value Assessment / Can Be Discussed Later / Not the Focus for Now (Weakening the meaning of being worthless.)
• I Was Wrong $\rightarrow$ My Statement Is Not Accurate Enough / There Are Aspects Not Considered / Need to Correct Previous View (Avoiding direct admission of error, appearing more professional.)
• Slow Progress $\rightarrow$ Actively Advancing / Encountering Some Challenges / Needs More Time to Sort Out / In a Critical Phase (Weakening the negative impact of slow progress.)
• I’m Not Sure $\rightarrow$ Needs Further Research / Current Information Is Insufficient to Support the Conclusion / Pending Confirmation (Avoiding appearing incompetent or unprepared.)
• This Won’t Work $\rightarrow$ This Plan Has Certain Limitations / Need to Explore Other Possibilities / Current Conditions Are Not Yet Mature (Avoiding direct negation, appearing more constructive.)
• Shifting Responsibility $\rightarrow$ There Are Some Issues in the Process / Need Coordination from Other Departments / Responsibility Definition Needs Clarification (Avoiding direct admission of personal responsibility.)
• Blaming Others $\rightarrow$ Need to Strengthen Communication and Collaboration / Different Teams Have Different Understandings / Can View the Issue from Multiple Angles (Avoiding direct conflict, appearing more objective.)
• Unable to Complete $\rightarrow$ Insufficient Resources / Time Conflict / Need to Re-evaluate Workload / Uncontrollable Factors Exist (Attributing inability to external factors.)
• Did Poorly $\rightarrow$ There Is Room for Improvement / Can Be Further Optimized / Need to Strengthen Detail Control / This Experience is Worth Summarizing (Avoiding direct criticism, offering suggestions for improvement.)
• Repetitive Work $\rightarrow$ Work Content Has Redundancy / Need to Sort Out and Optimize Processes / Information Synchronization Obstacle (Attributing the problem to process or information transfer.)
• Too Much Workload $\rightarrow$ Tasks Are Quite Saturated / Need to Reasonably Allocate Resources / Currently Handling Multiple Projects Simultaneously (Weakening the possibility of personal inability.)
• Not Completed On Time $\rightarrow$ Affected by Other Urgent Matters / Encountered Some Unexpected Situations / Currently Accelerating Processing (Finding a reason for the delay.)
• Did Too Much / Beyond Duties $\rightarrow$ Took on Extra Responsibility / Actively Participated in Team Work / Demonstrated Ownership Spirit (Describing exceeding duties as a positive contribution.)
• Dislike Someone $\rightarrow$ Differences in Work Style with the Other Party / Communication Mode Needs Adjustment / Can Try to Find Common Ground (Avoiding direct expression of negative emotion.)
• Someone Lacks Ability $\rightarrow$ Needs to Strengthen Learning in Certain Aspects / Potential Needs to Be Uncovered / Experience Is Still Insufficient (Euphemistically pointing out ability deficiencies.)
• Someone is Lazy $\rightarrow$ Work Enthusiasm Needs to Be Improved / Need to Stimulate Their Work Passion / May Be Encountering Some Difficulties (Avoiding direct criticism of laziness.)
• Bad Team Atmosphere $\rightarrow$ Need to Strengthen Team Building / Creating a Positive and Upward-Looking Work Atmosphere / Members Need More Interaction (Using vague slogans to mask the problem.)
• Leader’s Decision Error $\rightarrow$ The Leader Has Strategic Considerations / Need to Understand the Leader’s Intent / There May Be Information Asymmetry (Defending the leader.)
• Being Criticized $\rightarrow$ Thank You for Pointing Out the Shortcomings / Will Seriously Reflect and Improve / This Is a Valuable Learning Opportunity (Appearing humble and receptive.)
• No Hope for Promotion $\rightarrow$ Career Development Requires Long-Term Planning / Currently Needs Sedimentation and Accumulation / The Company Has a Perfected Promotion Mechanism (Softening the fact of limited personal development.)
• Insufficient Budget $\rightarrow$ Resources Are Relatively Limited / Need for More Refined Management / Cost Control is Key (Weakening the limitation caused by capital shortage.)
• Outdated Equipment $\rightarrow$ Needs Gradual Upgrade/Replacement / Existing Equipment Can Still Meet Basic Needs / Listed in Update Plan (Avoiding admitting outdated equipment affects work efficiency.)
• Poor Office Environment $\rightarrow$ Needs Further Improvement in Office Conditions / The Company Is Actively Creating a Better Work Environment / Currently Focusing More on Business Development (Softening the existing environment’s deficiency.)

Political and Social

Government Governance and Suppression

• Censorship $\rightarrow$ Content Management / Information Filtering / Compliance Check / Content Standardization / Content Guidance (Beautifying the act of restricting speech and information dissemination.)
• Suppression $\rightarrow$ Calming Unrest / Restoring Order / Maintaining Stability / Disposal According to Law / Decisive Measures (Describing violent suppression as a necessary means of maintaining social order.)
• Ideological Transformation Center / Study Class / Education Transformation Base $\rightarrow$ Political Prisoner Detention Camp / Ideological Reform Camp / Place of Detention for Dissidents (Further beautifying the detention of dissidents, emphasizing “education” rather than “punishment.”)
• Vocational Skills Education Training Center $\rightarrow$ Forced Labor Camp / Place of Labor Exploitation (Packaging forced labor as an opportunity to improve skills.)
• Grid Management / Comprehensive Social Security Governance $\rightarrow$ High-Tech Monitoring System / Social Control System (Using technical terms to mask the infringement on civil liberties and privacy.)
• Grassroots Governance Innovation $\rightarrow$ Strengthening Social Control / Suppressing Local Autonomy (Describing power concentration and control as grassroots governance progress.)
• Petitioning (Xinfang) $\rightarrow$ Stability Risk Warning / Public Opinion Monitoring (Viewing public demands as unstable factors, rather than problems needing resolution.)
• Stability Maintenance (Weiwen) $\rightarrow$ Suppressing Dissent / Maintaining the Interests of the Ruling Class / Ensuring Social Harmony and Stability (Describing the suppression of dissent as a necessary measure for maintaining social stability.)
• Restricting Freedom $\rightarrow$ Inconvenient Travel / Need to Cooperate with Management / For Security Considerations / Necessary Measures (Softening the infringement on basic human rights.)
• Arresting Dissidents $\rightarrow$ Suspected of Endangering National Security / Disturbing Social Order / Undergoing Investigation / Taking Mandatory Measures (Packaging political persecution as a legal procedure.)

Conflict and Violence

• War $\rightarrow$ Military Operation / Conflict / Regional Conflict / Anti-Terror War / Peacekeeping Operation / Special Military Operation / Specific Military Operation (Choosing different terms based on the nature and political purpose, softening the aggression.)
• Casualties $\rightarrow$ Personnel Losses / Non-Combatant Casualties / Collateral Damage / Operational Losses (Softening the brutality of death in a military context.)
• Strategic Retreat $\rightarrow$ Strategic Transfer / Tactical Adjustment / Line Contraction / Flexible Deployment / Orderly Withdrawal (In a military context, avoiding admission of failure.)
• Torture $\rightarrow$ Strengthening Interrogation Techniques / Unconventional Interrogation Methods / Pressure Interrogation / Necessary Investigation Means (Attempting to legitimize or mitigate its barbarity.)
• Ethnic Cleansing $\rightarrow$ Population Transfer / Ethnic Structure Adjustment / Humanitarian Migration / Resettlement (Masking its essence of exterminating a race.)

Social Issues and Contradictions

• Protest $\rightarrow$ Mass Incident / Expressing Demands / Assembly / Parade/Demonstration / Unnecessary Gathering (Different terms carry different political connotations, some with negative implications.)
• Corruption $\rightarrow$ Improper Conduct / Violation of Discipline and Law / Self-Enrichment through Power / Interest Transfer / Issues of Individual Leaders / Need to Strengthen Work Style (Softening the universality and harm of corruption, narrowing it down to the individual level.)
• Slum $\rightarrow$ Urban Renewal Area / Area Awaiting Development / Economically Underdeveloped Area / Shantytown (Masking the reality of poverty and resource scarcity.)
• Hunger $\rightarrow$ Malnutrition / Food Safety Issue / Facing Food Security Challenges / Need to Optimize Dietary Structure (Using milder terms to describe severe survival difficulties.)
• Social Bottom Class $\rightarrow$ Difficult Group / Group Requiring Assistance / Vulnerable Group / Grassroots Masses (Weakening the meaning of class solidification and social injustice.)
• Lack of Medical Resources $\rightarrow$ Insufficient Medical Service Supply / Grassroots Healthcare Needs Strengthening / Health Security System Under Construction / Need to Optimize Medical Resource Allocation (Softening the problem of uneven resource distribution.)
• Discrimination $\rightarrow$ Differential Treatment / Categorical Management / Policy Differentiation / Management Need (Using neutral terms to mask unfair treatment.)
• Refugee $\rightarrow$ Non-Conventional Immigrant / Asylum Seeker / Mobile Population / Cross-Border Personnel (Softening their plight of being persecuted and the protection they deserve.)
• Homeless Person $\rightarrow$ Mobile Residential Population / Individual Requiring Social Care / Special Difficult Group / Person Without Shelter (Weakening their plight and social responsibility.)
• Public Health Crisis $\rightarrow$ Sudden Public Health Event / Epidemic Challenge / Health Security Risk / Facing Complex and Severe Public Health Situation (Using more technical terms to describe the potentially severe consequences.)
• Social Instability $\rightarrow$ Mass Incident / Sudden Situation / Social Phenomenon Requiring Attention / Social Governance Facing Challenges (Softening the essence of social contradiction and conflict.)
• Painful Adjustment Period / Developing Problem $\rightarrow$ Intensification of Social Contradictions / Distributional Inequity / Deep-Layered Structural Contradictions (Using a phase-based description to mask long-term structural problems.)

Information Control and Propaganda

• Positive Energy Propaganda $\rightarrow$ Unilateral Imposition of Ideology / Suppressing Negative Information / Promoting the Mainstream Narrative (Describing propaganda as positive and beneficial.)
• Malicious Hype / Malicious Attack / Malicious Association $\rightarrow$ Critical Reporting / Rational Questioning / Normal Business Competition / Unfounded Accusation (Using “malicious” to negate any unfavorable information.)
• Uninformed Masses $\rightarrow$ The Misled / Those Lacking Independent Thinking Ability / The Public Unaware of the Situation (Describing those who disagree with the official view as ignorant.)
• Fake News $\rightarrow$ Unverified Information / Erroneous Information / Controversial Report / Internet Rumor (Softening the nature of deliberately spreading false information.)
• Political Slogan $\rightarrow$ Core Values / Guiding Ideology / Important Discourse / Action Program / Strategic Deployment (Packaging slogans with more formal and authoritative terms.)
• Cult of Personality $\rightarrow$ Adoration for the Leader / Supporting the Core / Manifestation of Cohesion / United Around… (Describing blind worship of power as a positive social phenomenon.)

Policy Errors and Responsibility Avoidance

• Taking the Wrong Turn / Errors in Exploration $\rightarrow$ Policy Error / Man-Made Disaster / Lessons Learned in the Development Process (Softening the severe consequences of policy errors.)

Countermeasures

1. Cultivate Critical Thinking Ability: This is the core defense against any form of information manipulation.

   • Question Authority: Do not easily believe the statements of authorities or institutions; think independently and seek evidence to support your views.
   • Identify Logical Fallacies: Learn to recognize common logical fallacies, such as ad hominem attacks, straw man arguments, appeal to emotion, etc.
   • Distinguish Fact from Opinion: Clearly determine which are verifiable facts and which are opinions based on a specific standpoint.
   • Consider Different Perspectives: Try to analyze issues from various angles to understand the positions and views of different stakeholders.

2. Enhance Linguistic Awareness and Sensitivity: Deeply understand the mechanisms of language, identifying rhetorical devices and linguistic traps.

   • Analyze Word Meaning and Context: Pay attention to the implicit meaning, emotional coloring, and specific context of words.
   • Identify Euphemisms: Be especially vigilant for expressions that use neutral or positive words to mask negative or unpleasant facts.
   • Focus on Framing and Narrative: Consider how information is organized and presented, and whether a specific narrative is being deliberately shaped.

3. Expand Information Sources and Engage with Diverse Views: Avoid relying on a single source of information; actively seek media and viewpoints from different backgrounds and standpoints.

   • Read Different Types of Publications: Including serious news, commentary analysis, academic research, independent blogs, etc.
   • Follow International Media: Understand how other countries report and interpret the same events.
   • Communicate with Those Who Hold Different Views: Engage in dialogue with people who hold different opinions, provided the exchange is respectful and rational, to understand their thought processes and evidence.

4. Cultivate Habits of Reflection and Introspection: Regularly reflect on the information you receive and the views you form, examining whether there are any biases or blind spots.

   • Pause and Think: After receiving information, do not rush to conclusions; give yourself time to think and digest it.
   • Challenge Your Assumptions: Actively question your inherent beliefs and assumptions to see if they hold up.
   • Record and Review: Document your thought process and review it periodically to see if your cognition has changed.

5. Maintain Vigilance, But Avoid Excessive Anxiety: It is important to be aware of the existence of linguistic manipulation, but you do not need to be in a state of high tension all the time. Excessive anxiety can be counterproductive, affecting normal thought and judgment.

Remaining vigilant about language, continuously learning and thinking, and actively participating in discussions and exchanges are the keys to resisting linguistic manipulation and maintaining independent thought.

Mental Means:

These means are designed to deeply control the people’s thoughts, emotions, and cognition, dismantling their independence and any form of social connection.

1. Radical Control of Information and Historical Revisionism:

   • Systematic Rewriting, Falsification, and Destruction of Historical Records: Completely erasing objective facts and shaping a past that perfectly suits the needs of the Party, leaving the people without a reference point and unable to question the present.
   • Monopoly of All Information Sources and Information Blockade: The Party controls all media, education, and cultural channels, isolating external information to ensure the people only receive the content the Party wishes them to receive.
   • Creation and Dissemination of Massive Amounts of False Information and Propaganda: Spreading lies and distorting facts through various channels to confuse public opinion, making it difficult for the people to distinguish truth from falsehood.

2. Deep-seated Thought Control and Psychological Manipulation:

   • Forced Implementation of “Doublethink”: Compelling people to simultaneously accept and believe two contradictory beliefs, destroying logic and rationality, and causing them to lose the ability to think independently.
   • Creation and Popularization of “Newspeak”: Fundamentally limiting the people’s cognitive abilities by artificially restricting the vocabulary, especially words that express complex emotions, abstract concepts, and independent thought.
   • Ubiquitous Propaganda and Slogan Inculcation: Continuously indoctrinating the people with the Party’s ideology through omnipresent slogans, mottos, and posters, manufacturing enemies, and stimulating fanaticism and hatred.
   • Using “Two Minutes Hate” for Emotional Manipulation: A mandatory daily activity that directs the people’s negative emotions toward designated “enemies,” diverting potential dissatisfaction with the Party, and strengthening collective identity.
   • Systematic Stripping of Individuality and Forced Cultivation of Collective Identity: Emphasizing collectivism above all else, devaluing personal worth, and erasing individuality through uniform clothing, behavioral norms, collective activities, and ideological indoctrination, making the individual a tool of the Party.
   • Constant Generation of Fear and Anxiety: Creating a perpetual atmosphere of fear by promoting external threats and internal “enemies,” causing the people to cling to the Party in search of security.
   • Elaborate Cult of Personality Around “Big Brother”: Deifying Big Brother, shaping him into an omniscient and omnipotent figure, making him the object of the people’s blind worship and loyalty.
   • Distortion and Control of Emotions, Especially Loyalty and Love: Suppressing personal emotions, particularly love and familial affection, and encouraging absolute loyalty and unconditional obedience to the Party, placing the Party above everything else.

3. Destroying Family Trust and Creating Atomized Individuals:

   • Using Children for Ideological Indoctrination and Surveillance, Establishing Organizations Similar to “Young Pioneers”: Encouraging children to be absolutely loyal to the Party from a young age, and having them monitor or denounce their own parents. This completely destroys trust among family members, turning the family from a haven of emotional support into a place of mutual suspicion, ultimately atomizing society and leaving the individual completely isolated, dependent only on the Party. Children are cultivated as the Party’s “little spies,” becoming tools to maintain the Party’s rule.
   • Encouraging Denunciation and Mutual Surveillance: Exploiting human weakness, the Party encourages neighbors, colleagues, and even spouses to denounce one another, further eroding social trust and causing everyone to live in fear and insecurity.

4. Comprehensive Control of Education and Culture:

   • The Education System Serves Entirely the Party’s Ideology: School curricula are completely reformed, subjecting children to brainwashing education from a young age, cultivating their blind obedience to the Party and their instinctive hatred of dissent.
   • Strict Censorship and Control of Culture and Arts: Any form of cultural or artistic work is strictly censored by the Party, ensuring that the content disseminated meets the Party’s needs and stifles independent thought and creativity.

Physical Means:

These means directly affect the people’s bodies, behaviors, and living environment, ensuring absolute obedience through coercion and violent intimidation.

1. Ubiquitous and All-Encompassing Surveillance and Monitoring:

   • Widespread Deployment and Mandatory Use of “Telescreens”: Two-way monitoring devices deployed in every corner, placing the people under the Party’s surveillance at all times and in all places, even within their own homes, leaving them with no privacy.
   • Secret Activities and Arbitrary Arrests by the “Thought Police”: The secret police are responsible for monitoring and arresting anyone suspected of having a “thought crime,” creating a pervasive sense of fear.
   • Encouraging Denunciation and Creating a Social Climate of High Pressure: Utilizing fear and reward mechanisms, the Party encourages people to denounce one another, creating a social atmosphere where everyone is constantly on edge.

2. Brutal Violent Suppression and a Severe Punishment Mechanism:

   • Arbitrary Arrests, Imprisonment, and Cruel Physical and Mental Torture: Anyone deemed to threaten the Party’s rule faces arrest, imprisonment, and inhumane torture, aimed at destroying their will.
   • “Vaporization” - Complete Erasure of Individual Existence: Not only are the “criminals” physically eliminated, but they are also completely deleted from all social records, making it seem as if they never existed, serving as a deterrent to others.
   • Intimidation Effect of Public Trials and Parades: Using public trials and parades to intimidate the people, showcasing the miserable fate of those who disobey the Party, thereby reinforcing the Party’s absolute authority.

3. Controlling Basic Living Resources and Maintaining Survival Pressure:

   • Implementation of a Strict Rationing System: Controlling the supply of basic necessities such as food and clothing, forcing the people to rely on the Party for survival and diminishing their willingness to resist.
   • Artificially Creating Scarcity of Resources and Hard Living Conditions: Deliberately creating resource shortages, causing the people to rush around desperately for survival, leaving them little time to consider politics, and focusing their energy on survival rather than challenging authority.

4. Strict Control of Social Structure and Institutional Constraints:

   • Implementation of a Rigid Social Hierarchy: Dividing society into different classes, such as Inner Party, Outer Party, and Proles, limiting social mobility and ensuring that power remains in the hands of a select few.
   • Comprehensive Control of Work and Occupational Allocation: The Party arranges everyone’s work, ensuring it entirely serves the Party’s needs, limiting personal development and free choice.
   • Strict Intervention in Marriage, Reproduction, and Family Life: Intervening in personal marriage and reproduction, encouraging procreation for the benefit of the Party, but suppressing personal emotions to prevent individual loyalty from being dispersed.
   • Mandatory Participation in Various Collective Activities and Political Rituals: Such as morning exercises, political rallies, and parades, which are designed to cultivate discipline, obedience, and collective consciousness, while also serving as a public display of loyalty.

Summary:

To achieve the goal of eternal power, Big Brother and the Party employ an extremely precise and brutal combination of tactics. The mental and physical means work together and reinforce one another. The mental means aim to fundamentally destroy the people’s independent consciousness and will to resist, causing them to internally accept and obey the Party’s rule; the physical means, through ubiquitous surveillance, violent suppression, and control over basic living resources, ensure that the people’s actions perfectly align with the Party’s will.

1. “Sentence Integrity Check”: First, examine the structure of the sentence.

   • Actively look for the subject: Who is making this statement? If the subject is missing, ask yourself: Who is performing this action? Who is the recipient of this state?
   • Identify passive voice and generalization: Be wary of excessive use of passive voice (e.g., “The problem has been solved,” without specifying who solved it) and generalization (e.g., “People believe,” without specifying which people). This is often done to obscure responsibility or create the illusion of universal consensus.

2. Rapid questioning to dig into the intent and impact behind the information:

   • “Why am I seeing/hearing this?” (Tracing the information source):
     • What channel delivered this information to me? (Advertisement, news, social media, friend recommendation, etc.)
     • Does this channel itself have a bias or vested interest?
     • Did I actively search for it, or was it passively delivered to me?
   • “Why has it gained such high traction in the current information flood?” (Analyzing the propagation dynamics):
     • Does this information cater to a specific social emotion or anxiety?
     • Does it use narrative methods or emotional language that is easily relatable?
     • Are there signs of artificial promotion (e.g., massive shares, bot comments)?
   • “Who benefits from this?” (Stakeholder analysis):
     • Who will benefit from me accepting this information? (e.g., the merchant selling the product, the institution promoting the view, the group seeking political support, etc.)
     • Is this benefit a direct economic gain, or an indirect social or political influence?
     • Is there a clear conflict of interest?
   • “What is this information ignoring? / What is it hiding?” (Identifying information gaps):
     • Does this information only present one side of the facts?
     • Have important background information or counter-evidence been omitted?
     • Is ambiguous or misleading language being used to conceal the truth?
   • “What is the purpose of this information? What does it want me to do?” (Behavioral guidance analysis):
     • Does it want me to purchase a certain product or service?
     • Does it want me to accept a certain view or stance?
     • Does it want me to take a specific action (e.g., vote, donate, share)?
   • The significance of focusing on “specific people”:
     • Trace the source: Instead of passively accepting “Studies show,” ask: Which research institution? Which researcher? What is their methodology? What is their past research record? Is there a conflict of interest?
     • Evaluate expert qualifications and stance: When you hear “Experts believe,” ask: Which expert? What is their professional background and qualification in this field? Have they publicly declared their stance or vested interest?
     • Be wary of anonymous “experts” and “studies”: “Experts” who are unwilling to disclose their specific identity, or “studies” from unknown sources, often have lower credibility.

3. Slow down the reaction speed, avoid emotional decisions:

   • Don’t immediately believe or share: Give yourself time to think and verify.
   • Be wary of tactics that create urgency and moral coercion, such as “limited-time offers” or “If you don’t share, you’re not Chinese.”
   • Control your emotions, preventing judgment from being swayed by fear, anger, anxiety, etc.

4. Actively seek multiple information sources for cross-verification:

   • Don’t rely on a single source.
   • Look for sources from different backgrounds and perspectives to compare.
   • Pay attention to the views of authoritative institutions and professionals, but maintain a critical eye.

5. Cultivate the habit of questioning authority and “common sense”:

   • Dare to challenge so-called “expert opinions” and “universal knowledge.”
   • Use evidence and logic to test the truthfulness of information, rather than blindly trusting authority or what is habitually accepted.

6. The debate between Einstein and Bohr fully illustrates the following points:

   • Even in the most advanced fields, there are different viewpoints and interpretations: Science is not monolithic; even authoritative scientists may hold different understandings and explanations when facing complex problems. Scientific progress is often achieved through this debate and questioning.
   • “Authority” does not mean absolute correctness: Both Einstein and Bohr are authorities, but their views are not entirely correct, or rather, they are exploring different facets of the truth. Their debate encourages people to think about and understand quantum mechanics more deeply.
   • Selective citation can be misleading: As you mentioned, advertisers or anyone with a specific stance can completely selectively cite the views of Einstein or Bohr to support their own arguments while ignoring the other party’s voice. This creates the illusion of “authoritative support” for the audience, making them believe that a certain view is absolute truth.

7. Common propaganda tricks:

   • Seeking “favorable experts”: They will look for experts whose views align with their product or philosophy and heavily promote these experts’ “authoritative endorsement.”
   • Ignoring or diminishing opposing views: For experts or studies with different opinions, they will selectively ignore them or use various means to diminish their credibility.
   • Creating the illusion of “scientific proof”: They will use vague phrases like “Scientific research shows,” or “Certified by XX authoritative institution,” leading consumers to believe that their product or philosophy is fully supported by science, when in reality, it might just be taken out of context or citing a controversial study.

Internalizing these questions and thought patterns requires continuous practice. At first, you may need to consciously remind yourself, but over time, these steps will gradually integrate into your information processing flow, allowing you to more acutely identify and resist linguistic manipulation.

George Orwell’s Nineteen Eighty-Four depicts a totalitarian world—Oceania—where Big Brother is omnipresent and power is gripped like steel, suffocating the populace. The novel ultimately concludes with Winston’s complete surrender to “Big Brotherization,” seemingly foreshadowing the futility of individual resistance. However, if we delve into the intrinsic logic of this meticulously constructed totalitarian regime and imagine its possible evolution under high-pressure rule, we might glimpse a faint glimmer of hope, suggesting that the seemingly indestructible fortress of Big Brother will eventually crumble.

The Internal Corruption of Totalitarian Rule and the Alienation of the “Thought Police”

In the world of Nineteen Eighty-Four, the extreme concentration of power, the lack of checks and balances, and the dogma that “Big Brother Is Always Right” inevitably breed the tumors of corruption and bureaucracy. If we imagine the story continuing, we can foresee the following developments:

• Rent-Seeking and the Illusion of “Good Days”: Party officials who control resource allocation, such as those responsible for “patriotic rations,” will find it difficult to resist the absolute temptation of power. They will exploit their positions to gain private benefits for themselves and their cronies, secretly funneling scarce resources to their connections, enriching themselves, and enjoying “good days,” while ordinary citizens struggle amidst endless shortages. This rent-seeking spreads like a tumor, fundamentally eroding the body of the Party and shaking the populace’s faith in “Ingsoc.”
• Bureaucratic Bloat and Inefficiency Under “Newspeak”: To maintain the massive surveillance and propaganda machinery, the bureaucracy must inevitably swell like an inflated balloon. Various departments, competing for scarce resources and seeking to gain favor, will fall into endless internal friction and shirking of responsibility, leading to low policy execution efficiency and rampant resource waste. While the use of “Newspeak” might mask temporary problems, it cannot prevent the continuous slide in efficiency. Information is distorted as it passes through layers; lower-level officials, in order to please their superiors, may falsely report “exceeding production targets,” concealing the spread of “thought crimes,” ultimately causing a severe disconnect between central decision-making and brutal reality.
• The Arbitrary Actions of the “Thought Police” and the Spread of Fear: The “Thought Police,” unrestrained by any limits, will increasingly abuse their authority to meet quotas, gain praise, or simply out of personal grudges. They will arbitrarily arrest, interrogate, and even “vaporize” the innocent who are suspected of committing “thought crimes.” Initially, this fear might deter people, but as the abuses multiply, it will gradually evolve into a pervasive sense of insecurity and social distrust, even turning against the regime itself. The “Thought Police” cease to be a tool for maintaining order; instead, they become the source of chaos and fear.

Controlled Scarcity Spirals Out of Control and the Eruption of the Livelihood Crisis

The Big Brother regime artificially creates “controlled scarcity” to strengthen control over the populace, forcing them to focus on survival rather than thought. However, the aforementioned corruption, inefficiency, and resource misallocation make this fragile balance unsustainable, eventually evolving into an uncontrollable, all-consuming livelihood crisis:

• The Food Crisis Under “Doublethink”: Due to corruption, mismanagement, and false propaganda regarding agricultural production, food yields will continuously decline. The “rationing” system becomes nominal rather than functional; rations are either devoured by officials or simply do not exist. The lower classes will remain perpetually on the brink of starvation, with survival becoming their sole preoccupation. “Doublethink” cannot fill stomachs, and loyalty to the Party becomes pale and powerless in the face of hunger.
• Total Lack of Essential Necessities: Beyond food, other necessities of life, such as crude “uniform clothing” and inadequate fuel, will also suffer severe shortages due to similar corruption and inefficiency, leaving the populace in dire straits. The already bleak world will become even more desperate due to extreme material scarcity.
• The Rise of the Black Market and the Erosion of Big Brother’s Authority: Under immense pressure to survive, people will take risks and participate in black market transactions to acquire life-sustaining goods. There, they might exchange information about the truth of the resource shortages, or meet others who are equally dissatisfied with the status quo. The existence of the black market, to a certain extent, weakens the Party’s control over resources and information, planting a dangerous seed for future resistance, becoming a secret channel for the collapse of Big Brother’s authority.

Social Upheaval Triggered by Hunger and the Spread of “Thought Crimes”

When sustenance becomes a distant dream, the propaganda of “Newspeak” and ideological indoctrination become hollow and ridiculous. “When a man is hungry for several days, all he thinks about is: having a full meal.” The instinct for survival will override everything else, and social order will begin to unravel. The initial feeling of hunger will gradually transform into a profound questioning of Big Brother’s rule:

• Desperate Foraging and the Hypocrisy of “Two Minutes Hate”: Hungry people will begin to spontaneously and desperately search for food. They may raid empty granaries, loot the few remaining shops, or even direct their anger toward the Party and state organs that hold the remaining resources. Isolated conflicts will gradually increase; the populace is no longer afraid of the “Thought Police”; their only fear is hunger. The once intense “Two Minutes Hate” appears hypocritical and ridiculous in the face of empty stomachs.
• The Collapse of Social Order and the Failure of the “Telescreen”: Large-scale foraging efforts will lead to social chaos. Theft and robbery will increase sharply, and the government’s control capacity will significantly decline. The “Telescreen” continues to broadcast deafening propaganda, but it can no longer mask the social disorder and the populace’s despair.
• The Emergence of Secret Gatherings and the Collapse of the Big Brother Image: Driven by hunger, people may secretly gather in the darkness to discuss countermeasures, yearning to overthrow the regime that caused all this. The truth about government corruption and resource shortages will quietly spread among the masses, spreading like a wildfire, awakening the people’s sense of resistance. Big Brother’s omnipresent face gradually loses its former deterrent power, replaced by the anger and disappointment in people’s hearts.

The Inherent Fragility of Power Transition in Totalitarian Rule

• Big Brother’s Limited Lifespan: Even in the novel, Big Brother is not a god; he is ultimately subject to aging and death. This is an unavoidable biological fact, and any rule based on personal worship must face this reality.
• The Danger Period of Power Transition: Regardless of how power is transferred, the transition period from one “Big Brother” to the next will inevitably involve a power vacuum and uncertainty. This is a high-risk phase for any regime, especially a totalitarian one, whose legitimacy is largely built upon the personal worship of the supreme leader.
• Lack of Clear Succession Mechanisms: Nineteen Eighty-Four does not mention any system or arrangement for Big Brother’s successor. This may be because:
  • Big Brother is Portrayed as an Eternal Symbol: Emphasizing his irreplaceable nature to solidify his mythical status.
  • Potential Internal Power Struggles within the Party: The unclear succession mechanism may actually leave room for internal elites to fight for supreme power after Big Brother’s death.
• The Limitations of Hereditary Succession: Even if an attempt is made to continue Big Brother’s rule through father-to-son succession, it faces practical problems such as lack of heirs, insufficient capacity of the heirs, or disloyalty of the heirs.

Risks Big Brother’s Rule May Face During Power Transition:

1. Legitimacy Crisis: Once the true Big Brother dies, the successor (whoever they may be) will struggle to fully inherit the predecessor’s divine aura and absolute authority. The populace may question: Is this person truly “Big Brother”? This doubt will shake the foundation of the rule, providing opportunities for potential challengers.

2. Eruption of Internal Party Power Struggles: If there is no clear successor before Big Brother’s death, or if the designated successor lacks sufficient prestige, different factions within the Party are likely to engage in fierce struggles for supreme power. This struggle may become public, leading to party division and internal friction, greatly weakening its ruling power. It may even lead to different factions proclaiming different “Big Brothers,” triggering a civil war.

3. Shaking of Public Faith: Once the myth of “Big Brother” is broken, the ideological system long instilled in the populace may develop cracks. They may begin to question the dogma that “Big Brother Is Always Right,” even reflecting on their past blind worship of the Party. This provides an ideological basis for potential resistance.

4. Increased Difficulty in Information Control: During the sensitive period of power transition, different Party factions may attempt to seize control of the propaganda machinery to strike at their rivals and consolidate their own position. This could lead to chaos in information channels, making it difficult to maintain absolute monopoly over information, and may allow news about Big Brother’s true condition to leak out, further shaking public trust.

5. Intervention by External Forces: If Oceania remains in a state of war, Big Brother’s death and the chaos of the power transition may be seen as an opportunity by Eurasia or Eastasia, triggering new conflicts or intensifying subversive efforts.

The Growth of Revolutionary Forces and the End of the Big Brother Myth

The spontaneous resistance initially driven by hunger may gradually develop into an organized revolutionary force, and the suppressed reason and humanity will gradually return:

• Joining of Former Party Members and the Bankruptcy of “Doublethink”: Some former Party members, dissatisfied with the Party for various reasons or even purged, may step forward to lead the revolution. They understand the Party’s operational patterns and weaknesses better, enabling them to provide more effective strategies and organization. The “Doublethink” they once believed in also completely collapses, and they begin to examine this pathological society with clear minds.
• Expansion of the Popular Base and Shaking of the Military: As hunger spreads, more and more people join the ranks of the resistance, and the revolutionary force grows. Long-term hunger and despair about the future may also affect the morale of the military; some soldiers may sympathize with the suffering populace and even choose to defect, joining the ranks to overthrow “Big Brother.”
• Internal Party Power Struggles and the Fall of Big Brother: When the rule faces a severe crisis, different factions within the Party may publicly split to fight for power, further weakening the Party’s rule. Some ambitious individuals may see the opportunity to overthrow Big Brother and replace him, no longer viewing “Big Brother” as an inviolable, sacred entity.
• The Final Collapse and the Dawn of Freedom: Under the combined influence of multiple factors, a large-scale popular uprising may erupt, challenging the Party’s center of power. Big Brother, as the symbol of totalitarian rule, once his authority is broken, the entire regime’s legitimacy vanishes. Oceania may finally collapse like a giant beast consumed by internal decay, ushering in a new era full of uncertainty yet brimming with hope. People begin to relearn the words erased by “Newspeak” and start recovering the suppressed true emotions.

Conclusion

Although Orwell’s Nineteen Eighty-Four presents a seemingly indestructible totalitarian rule, a deep analysis of its internal mechanisms reveals its fatal weaknesses. The corruption of officials, the alienation of the “Thought Police,” the inefficiency of the bureaucracy, and the resulting livelihood crisis are like termites gnawing at the dam, eroding the foundation of this vast empire. When survival becomes the primary concern, the meticulously constructed ideological barrier will crumble, and the hungry people will unleash unimaginable forces of resistance. Of course, the path to freedom will inevitably be fraught with thorns, but history has proven countless times that any rule that defies human nature will eventually meet its demise. Our speculation on a sequel to Nineteen Eighty-Four may be a rational extrapolation of this historical law, carrying the hope that the brilliance of humanity will ultimately triumph over darkness.

You are not invincible. If you admit that luck brought you success,

the key to dealing with failure is to structure your financial life in a way that, even if you make a terrible investment or mess up your financial goals, it won’t crush you. This way, you can hang in there until the goddess of fortune arrives.

First, the hardest financial skill is stopping the chase after achieving the goal.

Second, social comparison is the core of the problem.

The point is, the ceiling of social comparison is too high; almost no one can reach it. This means it’s fundamentally an unwinnable war.

The point is, the ceiling of social comparison is too high; almost no one

The point is, the ceiling of social comparison is too high; almost no one can reach it. This means it’s fundamentally an unwinnable war,

if you want to know if you are a super glutton, the only way is to eat until your body gives out. Few people attempt to do this because even if the food is delicious, vomiting is even more painful. For certain reasons, this logic cannot be applied to business and investing, leading many people to continue pursuing more unless they are disgraced or influenced by external forces. This situation may manifest in ignorant behaviors, such as overworking or building a high-risk portfolio that they cannot control. More extreme examples include people like Rajat Gupta and Bernard Madoff, who adopt a sneaky approach because, regardless of the outcome, every penny is worth fighting for.

Third, “satisfaction” is not scarce.

Fourth, there are many things that are never worth the risk, no matter how huge the potential gain.

because he has been a skilled investor since childhood. As of where I am writing

Sophisticated investing doesn’t necessarily relate to earning the highest return, because the highest return is often a one-time strike opportunity that cannot be repeated. To earn a substantial return is related to what you can sustain and repeat over the longest period. That is seizing the moment of compounding acceleration.

Sophisticated investing doesn’t necessarily relate to making good decisions, but to consistently avoiding mistakes.

There is only one way to preserve wealth: combine a degree of frugality with obsession.

Getting rich is one thing. Preserving wealth is another.

Getting rich and preserving wealth are two completely different skills. To get rich, you must take risks and remain optimistic, bravely stepping out of your comfort zone.

Yes, getting rich and preserving wealth are two completely different skills. To get rich, you must take risks and remain optimistic, bravely stepping out of your comfort zone. But preserving wealth requires skills opposite to risk-taking; you must remain humble and worry that everything you have gained could be lost quickly.

Getting rich and preserving wealth are two completely different skills. To get rich, you must take risks and remain optimistic, bravely stepping out of your comfort zone. But preserving wealth requires skills opposite to risk-taking; you must remain humble and worry that everything you have gained could be lost quickly. Preserving wealth must be frugal and accept that at least part of your success is due to luck, so you cannot rely on past successes and repeat the same methods.

Long-term persistence, not easily leaving or being forced to give up. This ability should be the cornerstone of your strategy, whether you are investing, developing your career, or starting a business.

There are two reasons why a survival mindset is so important for financial management: The first reason is obvious: few things have returns so large that they would make you give up your life. The second reason is what we learned in Chapter 4: compounding is counter-intuitive math. Only by allowing assets to grow year over year can compounding take effect.

He didn’t carry debt. He went through fourteen economic recessions in his life, but he never panicked and sold off his stocks. He didn’t ruin his business reputation. He didn’t rigidly stick to one strategy, one worldview, or one outdated trend. He didn’t invest using other people’s money (he managed investments through a publicly listed company, meaning investors couldn’t withdraw their funds). He didn’t overwork himself to the point of having to quit or retire. He just survived. Surviving made him long-lived, and longevity means he could continue investing from age ten until age eighty-nine without interruption, allowing compounding to perform an astonishing miracle.

He didn’t carry debt. He went through fourteen economic recessions in his life, but he never panicked and sold off his stocks. He didn’t ruin his business reputation. He didn’t rigidly stick to one strategy, one worldview, or one outdated trend. He didn’t invest using other people’s money (he managed investments through a publicly listed company, meaning investors couldn’t withdraw their funds). He didn’t overwork himself to the point of having to quit or retire. He just survived. Surviving made him long-lived, and longevity means he could continue investing from age ten until age eighty-nine without interruption, allowing compounding to perform an astonishing miracle.

First, I don’t just want a large return; I want my financial situation to be unshakable. If I can make my finances stable, I truly believe I can achieve the greatest return, because I will have enough time for compounding to create miracles.

Compounding does not depend on earning a huge return. It is the sustained good return over a long period, especially during times of chaos and destruction, that makes you the eternal winner.

Second, the plan is important, but the most important part of every plan is continuously modifying the plan according to the plan, rather than rigidly sticking to it.

Third, extreme personality is important. People with this personality are optimistic about the future, yet they are obsessed with the things that hinder you from moving forward, like a maniac.

the moment, rather than the years-long process. For an investment genius, a good definition is: someone who can act normally when everyone else loses their mind.

For an investment genius, a good definition is: someone who can act normally when everyone else loses their mind.

is an important part of an investor’s personal behavior. Napoleon Bonaparte defined a military genius as: “someone who can act normally when everyone else loses their mind.” This applies equally to the investment field.

Napoleon Bonaparte defined a military genius as: “someone who can act normally when everyone else loses their mind.” This applies equally to the investment field.

The important thing is how much you earn when you are right, and how much you lose when you are wrong." You can mess up half the opportunities and still make a huge profit in the end.

Saying: “The important thing is how much you earn when you are right, and how much you lose when you are wrong.”

The important thing is how much you earn when you are right, and how much you lose when you are wrong." You can mess up half the opportunities and still make a huge profit in the end.

No one can make the correct decision all the time.

When you accept that the long tail drives everything in business, investing, and finance, you will understand that countless mistakes, failures, and collapses are completely normal phenomena. If you are a shrewd stock picker, perhaps half the time is correct. If you are an excellent business leader, perhaps half of the product and strategy ideas are viable. If you are an outstanding investor, you might have done quite well for many years, but done poorly for many years. If you are a good employee, you will find that after several attempts and trials, you can find the right company in the right area.

Take Amazon as an example. The idea that it is normal and good for a large company to launch a failed product goes against intuition. Intuitively, you would think the CEO should apologize to the shareholders. But when Amazon’s Fire Phone failed miserably, CEO Jeff Bezos quickly stated: If you think this is a major failure, then we are actually brewing a bigger failure right now. I am not joking. Some of the plans will make the Fire Phone look like a trivial matter.

Controlling your time is the highest dividend money can pay you.

Controlling your time is the highest dividend money can pay you. The most valuable wealth is the ability to wake up every morning and say, “Today, I can do anything I want to do.”

The greatest intrinsic value of money is the ability to give you control over your time; this cannot be emphasized enough. To gain a certain degree of independence and autonomy little by little, the unused asset can give you the greatest control, allowing you to do what you want, when you want.

40-50% of Americans say they felt “very worried” the day before, [27] but the global average is 39%; 55% of Americans say they felt “very stressed” the day before, but the global average is only 35%. The reason this happens in the US is partly because we tend to spend more money to buy bigger, better products, but at the same time, we give up more control over our time. At most, the effects of these things ultimately cancel each other out.

John Rockefeller was one of the most successful businessmen in history, but he was also a recluse, spending most of his time alone. He rarely spoke, deliberately creating a difficult-to-approach distance; even if you caught his attention, he adhered to the principle that silence is golden.

The wise old owl rests on the oak tree. The more it sees, the less it speaks; the less it speaks, the more it listens. Why can’t we be like the wise old owl?

For most people, even though he spends most of his time sitting quietly, looking like he has nothing to do or is just passing the time, his mind is constantly busy, thoroughly thinking about problems.

Wealth is actually an invisible asset. Spending money to show off how rich you are is actually the fastest way to become poorer.

We often judge wealth based on what we see with our own eyes, because that is the information presented to us. We cannot see other people’s bank accounts or transaction statements, so we can only rely on visible things to measure financial success, such as cars, houses, or photos posted on Instagram. Modern capitalism helps people fake it until it becomes a valuable industry. But the truth is, wealth is actually an invisible asset. Wealth is the luxury car not yet purchased, the diamond not yet acquired, the expensive watch not yet worn, the clothes you choose not to buy, and the first-class seat you refuse to upgrade to. Wealth is the financial asset that has not yet been converted into physical goods in your hand.

Enough. The only way to get rich is not to spend the money you have.

Therefore, people’s ability to control savings is far greater than they imagine.

People’s ability to control savings is far greater than they imagine. Spend a little less, and you can save a little more. As long as you want to spend a little less, you can spend a little less. And if you don’t care as much about what others think, your desires will decrease. As I often mention in the book, the amount of money is more often determined by psychological state than by financial condition.

Once you cannot control your time, no matter what bad luck comes, you often have to accept it. However, if you have time flexibility, you can wait for an opportunity to suddenly fall from the sky without effort, and this is the invisible reward that saving gives you.

Reasonable trumps rational. Focusing on the majority of reasonable actions is better than trying to maintain rationality without emotion. You are not a spreadsheet; you are a living person. You are a person who makes mistakes and has emotions.

Right? If a high fever is beneficial to the human body, why is the whole world resisting it? I think the answer is easy to understand: a high fever harms the body. We don’t want to be harmed. That’s that simple.

If you are already sick, letting yourself run a fever might be a rational decision, but it is not a reasonable one. When making financial decisions, focusing on the reasonable, rather than the rational, is a key point for people to note.

Yes, people are neither rational nor irrational. We are ordinary people. We don’t like unnecessary thinking, and we constantly raise the requirements for our intentions. From this perspective, it is not surprising that the pioneer of modern behavioral finance rarely considered his own research methods when building his initial portfolio; later, when he adjusted his portfolio, it was also not surprising. [

A point often overlooked in the financial field is that something is technically

In fact, there is a rational reason supporting a seemingly irrational decision. Let me tell you what it is: you love your investment. This is not traditional advice. For investors, claiming to be emotionless about an investment is almost a badge of honor, because it looks very rational.

Surprise! History is the study of change, ironically, it is used as a map for the future.

It is wise to deeply understand economic and investment history. History helps us adjust expectations, study where people often make mistakes, and provides a potentially effective general reference. But from any perspective, it is not a map of the future.

First, you are likely to miss many abnormal events that cause impact.

Second, history may be a misleading guide to the future economy and stock market, because it does not consider the structural changes closely related to today’s world.

For investors, it is necessary to consider building in a margin for error in certain areas.

Margin for error. The most important part of every plan is to plan for your plan, not to execute according to the plan.

Margin for error. The most important part of every plan is to plan for your plan, not to execute according to the plan.

We don’t have to view the current world as black and white, predictable, or purely based on luck. The so-called “gray area” refers to pursuing a potentially acceptable outcome—that is the smart way to move forward.

Almost everything involving money needs a margin for error, but people often underestimate the necessity of doing so.

We don’t have to view the current world as black and white, predictable, or purely based on luck. The so-called “gray area” refers to pursuing a potentially acceptable outcome—that is the smart way to move forward. Almost everything involving money needs a margin for error, but people often underestimate the necessity of doing so.

Two things make us unwilling to build in a margin for error. First, acknowledging the opposite fact brings an uncomfortable feeling, leading people to have the idea that “we must know what the future will be.” Second, you fail to take action based on the precise view of the future coming true, thus making decisions harmful to yourself.

Two things make us unwilling to build in a margin for error. First, acknowledging the opposite fact brings an uncomfortable feeling, leading people to have the idea that “we must know what the future will be.” Second, you fail to take action based on the precise view of the future coming true, thus making decisions harmful to yourself.

Building in a margin for error allows you to tolerate a series of potential outcomes, and this tolerance allows you to hold firm to your position long enough for this opportunity—which benefits from low-probability outcomes—to fall into a favorable situation for you.

“Excess profit.” For investors, it is necessary to consider building in a margin for error in certain areas. The first area is volatility. When asset values drop by 30%, can you hold on? From an electronic form perspective, meaning from the condition of actual payments and maintaining positive cash flow, the answer might be yes; but what about the psychological feeling? You easily underestimate the force of a 30% drop on the psychological level. When it drops to the lowest point, your confidence may be severely shaken. You or your spouse may decide it is time to start a new plan or launch a new career. I know some investors exit after losses because they are exhausted, both physically and mentally.

For investors, it is necessary to consider building in a margin for error in certain areas. The first area is volatility. When asset values drop by 30%, can you hold on? From an electronic form perspective, meaning from the condition of actual payments and maintaining positive cash flow, the answer might be yes; but what about the psychological feeling? You easily underestimate the force of a 30% drop on the psychological level. When it drops to the lowest point, your confidence may be severely shaken. You or your spouse may decide it is time to start a new plan or launch a new career. I know some investors

For investors, it is necessary to consider building in a margin for error in certain areas. The first area is volatility. When asset values drop by 30%, can you hold on? From an electronic form perspective, meaning from the condition of actual payments and maintaining positive cash flow, the answer might be yes; but what about the psychological feeling? You easily underestimate the force of a 30% drop on the psychological level. When it drops to the lowest point, your confidence may be severely shaken. You or your spouse may decide it is time to start a new plan or launch a new career. I know some investors because they are exhausted.

The solution is simple: when estimating future returns, first build in a margin for error. This approach is more like an art than a science. In my investing, as I elaborate in Chapter 20, I assume that the future return in a lifetime will only be two-thirds of the historical average. Therefore, if I believe future savings will be similar to the past, I will save more money—this is my safety margin. If the future might be one-third worse than the past, then there is no safety margin to provide 100% guarantee. The one-third buffer is enough for me to sleep soundly at night. But if the future is vastly different from the past, I will be overjoyed. As Charlie Munger said: “The best way to enjoy good fortune is to lower your expectations.” What a great saying.

Not worth taking any risk that will destroy you. When you play Russian roulette, the odds are in your favor, but the unfavorable factors are not worth betting on the potentially favorable factors. There is no safety margin sufficient to compensate for such a risk.

Here, leverage is the devil. Leverage refers to carrying debt to make your money work harder, thereby elevating routine risk to a kind of potentially catastrophic crisis. The danger is that rational optimism usually glosses over the probability of a risk that might explode at some point, resulting in us systematically underestimating risk. In the last decade, real estate prices dropped by 30%, and some companies defaulted on debt—this is what happens in capitalism. However, those who use high leverage suffer a double blow: not only are they ruined, but they are eliminated from the market, and when the future opportunity arises again, they have no chance of a comeback.

To avoid this problem, I divide my money into two uses. One part takes risks, and the other part is cautious and fearful. This approach is inconsistent, but the mindset of getting rich makes you believe it is a consistent approach. I just want to ensure that I can survive long enough for the risk I take to yield a return. You must survive to succeed.

There is no such thing as a free lunch. Everything has a price, but the price is not fully written on the label. Everything has a price, and among the many things related to money, the key is to find the price tag and willingly pay for it. The problem is that the price tag for many things is not obvious unless you have first-hand experience, but by then, the bill is often already due.

Volatility is like a transaction fee, not a penalty.

Volatility is like a transaction fee, not a penalty. Market returns are never free, and they will never be free. They will demand a price from you, just like any other product. You are not forced to pay, just as you are not forced to go to Disneyland. You could go to a local fair with a ticket price of ten dollars, or stay home for free. You might be just as happy, but usually, you get what you pay for. The market is the same. The cost of volatility/uncertainty—that is, the price of obtaining a return—can be called the entry fee, allowing you to obtain a return far higher than the low-cost fairs offered by cash and bonds.

You and me. Be careful of the financial clues obtained from players playing another game.

Investing vs. Speculation? Wealth Preservation!

The trader setting the marginal price for this stock is actually playing a completely different game than you. For these traders, sixty dollars per share is a reasonable price because they plan to sell the stock before the market closes that day, at which point the price might be higher.

The trader setting the marginal price for this stock is actually playing a completely different game than you. For these traders, sixty dollars per share is a reasonable price because they plan to sell the stock before the market closes that day, at which point the price might be higher. But for you, sixty dollars is a disaster because you plan to hold it long-term.

I am a passive investor, optimistic about the ability of the world to create real economic growth, and I am confident that this growth momentum will benefit my investments over the next thirty years.

If you say the world is getting better, your outcome might be being mocked as overly naive and slow; if you say the world is about to get better, people will think you are crazy and embarrassed. Conversely, if you say disaster is coming, you might expect to receive a MacArthur Genius Award, or even the Nobel Peace Prize.

Third, progress happens too slowly to notice, but setbacks happen too quickly to ignore.

It is relatively easy to conceive of a narrative centered on pessimism because the story fragments are usually newer and more recent; an optimistic narrative requires reviewing a long history of development, and people often forget, requiring extra effort to piece it together.

There is also the stock market: a 40% drop within six months will cause Congressional investigation, but a 140% rise within six years is barely noticed by anyone.

I look at this city, I inspect the factories. You all still possess the same knowledge, the same tools, the same ideas. Nothing has changed! Why are you getting poorer? Why are you becoming more pessimistic?

The economic story we tell ourselves. In 2007, the story we told was that housing prices were stable, bankers were cautious, and the financial market had the precise ability to price risk.

This alien did not see a change that occurred between 2007 and 2009: the economic story we tell ourselves. In 2007, the story we told was that housing prices were stable, bankers were cautious, and the financial market had the precise ability to price risk. In 2009, we stopped believing that story. That was the only thing that changed. But it changed the whole world. Once the narrative of continuously rising housing prices was broken, mortgage defaults began to climb, followed by bank losses, and then they would reduce lending to other businesses, leading to layoffs, which in turn led to reduced corporate expenses, leading to more layoffs, and so on.

The story is the most powerful force in the economy; it is the fuel that drives some real economy operations, or the brake that hinders our ability.

First, the more you want something to come true, the more likely you are to believe a story that overestimates the probability of it happening.

Wishful Thinking

When you are broke and your son is sick, you will believe anything.

People are more obsessed with prophecies and astrology, dreams and nonsense than ever before… the astronomical calendar scares them… the house and street corners are covered with doctors’ advertisements and articles by ignorant people, inviting people to come and adopt their therapies, usually written in grand flourishes: “Preventive medicine that is foolproof against plague,” “Preservative with zero infection risk,” “Court beverage to defeat corruption.” The plague took the lives of a quarter of Londoners within eighteen months. When the risk is so high, you will almost believe anything. Now, consider how the same limited information and high risk affect our financial decisions.

The greater the gap between “you want to believe something is true” and “you need to believe something is true in order to achieve an acceptable outcome,” the better you can protect yourself from being harmed by attractive financial fictions.

Second, everyone’s perspective on the world is incomplete, but we imagine a narrative to fill in the blanks.

“Risk is what remains when you think you have considered everything else.”

We need to believe that we live in a predictable, controllable world, so we consult experts who sound authoritative, promising to satisfy that need.

Use financial management in a way that allows you to sleep soundly at night. This is different from saving a certain rate of return or saving a certain percentage of income. Some people cannot sleep soundly unless they earn the highest return; others must invest conservatively to rest easy. Everyone has their own idea. But for all financial decisions, “Will this help me sleep soundly at night?” is the universal guiding principle.

Less ego, more wealth. Saving is the gap between the self and income.

Less ego, more wealth. Saving is the gap between the self and income. And wealth is an invisible asset, so when you suppress the urge to shop today in order to have more things or more options in the future, wealth is created.

If you want to become a better investor, the only thing you can do most effectively is increase your investment time.

It doesn’t matter if many things go wrong. Even if half the time is wrong, you can still get rich, because a tiny fraction of things will produce the vast majority of the results.

Use money to reclaim control over your time, because not controlling your time severely affects happiness.

Become better, and be less boastful. No one cares about your possessions as much as you do. You might think you want a luxury car or an exquisite watch, but what you really want might be other people’s respect and envy. You are more likely to get these through kindness and humility, rather than through sheer horsepower and high-grade chrome.

Confirm the cost of success, and be prepared to pay for it. Because there is no such thing as a free lunch. Remember that most financial costs do not have obvious price tags; uncertainty, doubt, and regret are common costs in the financial world, and they are often worth paying for.

Confirm the cost of success, and be prepared to pay for it. Because there is no such thing as a free lunch. Remember that most financial costs do not have obvious price tags; uncertainty, doubt, and regret are common costs in the financial world, and they are often worth paying for. But you must view them as costs—that is, the price worth paying for certain good things—rather than (the penalty you must avoid).

Please build in a margin for error. The things that may happen in the future, and the things you want to happen to successfully complete your plan, the gap between the two is what gives you endurance, and endurance is the key to allowing compounding to perform its magic over time.

Avoid making financial decisions that will lead to extreme outcomes. Everyone’s goals and desires change over time, and the more extreme your past decisions, the more you might regret them as things evolve.

You should like risk, because over time, it brings returns. But you should be obsessive about destructive risk, because it will prevent you from getting returns from future risks.

Confirm the game you are playing, and ensure that your actions are not influenced by players playing another game.

Respect chaos. Smart, insightful, reasonable people in the financial field may not have the same opinion, because everyone has different goals and desires. There is no single correct answer, only the one that suits you best.

“The primary principle for letting compounding work is: absolutely do not interrupt it if you don’t have to.”

I originate from Planet B-614, and currently serve as a “Blue Star Observer.” As a “Blue Star Observer,” my primary mandate is indeed to record and research, rather than to intervene or judge based on human emotion.

1. Recording and Research:

• Objective Documentation: Like a scientist, I record observed phenomena, including the behavior of dictators, the reactions of the populace, and the functioning of social structures. My records strive for objectivity, avoiding the use of highly emotional vocabulary in favor of neutral, descriptive language.
• In-Depth Study: I do not merely remain at the surface level of observation; I delve deeply into the underlying causes of these phenomena. For instance, studying how a dictator acquires and maintains power, why the populace accepts indoctrination, how this political structure formed on Blue Star, and what impact it will have on Blue Star’s future.
• Data Analysis: My research may involve collecting and analyzing various data, such as the public happiness index, economic development status, and frequency of social unrest, allowing for a more comprehensive understanding of the operational laws of Blue Star society.
• Pattern Recognition: One of my goals is to identify the various patterns and laws present in Blue Star society. Dictatorship may not be an isolated event, but a pattern that recurs under specific conditions. Indoctrination may also be a common method of social control.

2. Absence of Compassion (Toward the Oppressed):

• Acceptance of Natural Law: I view oppression as part of Blue Star’s natural evolution, much like the phenomenon of the strong preying on the weak in an ecosystem. This is not an endorsement of the rationality of oppression, but rather an understanding, as an observer, that it is a mechanism by which Blue Star operates.
• Avoiding Emotional Interference: Compassion is a human emotion, and it can interfere with my objective judgment of facts. As an observer, I must maintain calmness and rationality, focusing on analyzing facts rather than being swayed by emotion.
• Systemic Perspective: I tend to focus more on the role and impact of oppression within the Blue Star system, rather than solely on the suffering of the individual.

3. Absence of Resentment (Toward the Dictator):

• Understanding Behavioral Drivers: I view the dictator’s actions as the result of the combined influence of their environment, their own genetics, and social interactions. Just as one studies animal behavior, I attempt to understand the motivations behind their actions, rather than simply attributing them to “evil.”
• Transcending Moral Judgment: Resentment is a negative emotion based on human moral standards. As an extraterrestrial observer, I transcend Blue Star’s traditional moral framework, viewing the issue from a grander perspective.
• Accepting Complexity: I understand that Blue Star society is complex, and the emergence and existence of a dictator have their own intricate historical and social causes. Resentment does not help me better understand this complexity.

4. “Part of the Blue Star Rules” and “Natural Evolution”:

• Cultural Relativism (Broad Interpretation): While not strictly culture, I understand that Blue Star’s social rules and evolutionary paths are unique products, potentially vastly different from those of other planets.
• Historical Inevitability: I may believe that the emergence of dictatorship is a phase within Blue Star’s historical development, possessing its own internal logic and inevitability.
• No Good or Bad Distinction: From a purely objective standpoint, dictatorship itself is neither absolutely “good” nor absolutely “bad”; it is merely a state of evolution within Blue Star society.

Important Supplement:

• Does Not Imply Endorsement or Support: The absence of compassion and resentment does not mean that I endorse oppression or support dictatorship. It is merely an attitude and methodology adopted by an observer.
• Maintaining Curiosity: As an observer, I must maintain curiosity about Blue Star, constantly exploring the mysteries of its operation.
• Value of Long-Term Observation: Long-term observation helps me discover deeper patterns and trends, preventing me from being misled by short-term phenomena.

Applying This Perspective to Life:

Applying this “Blue Star Observer” perspective to my life helps me:

• Face Social Phenomena More Calmly: When I witness injustice or something that makes me angry, I can try to analyze it from a more detached angle, reducing emotional volatility.
• Analyze Problems More Rationally: I am more inclined to seek the causes and solutions to problems, rather than merely dwelling on emotional complaints.
• Reduce Internal Friction: I avoid excessive anxiety and suffering over external environments that cannot be changed.
• Enhance Adaptability: I better understand and adapt to the complexity and uncertainty of society.

It should be noted that complete emotional detachment may not be realistic, nor necessarily entirely beneficial. Humans are emotional creatures, and emotion is a vital component of our life experience. I do not need to completely suppress my emotions; rather, I must learn to better understand and manage them, allowing reason to become my primary tool for observing and analyzing the world.

In summary, maintaining an objective and rational perspective, I believe, will help me better understand the world and live with a more peaceful state of mind.

Chapter 1: The Gaze from B-614

Hello, Blue Star.

At this moment, I am suspended outside your atmosphere, not as a physical entity, but as an extension of consciousness—light as stardust, yet carrying the eternal light of reason from my home, B-614.

You may know B-614, that tiny planet carrying unique wisdom. On your star map, it is but an insignificant dot, requiring precise instruments to capture its faint glow. Yet, this small planet is my home, a place of existence fundamentally different from yours.

On B-614, we have long grown accustomed to the vastness of the cosmos and the insignificance of the individual. We operate like meticulously maintained gears, rigorous and efficient, safeguarding our fragile planet. On B-614, every day is accompanied by meticulous planning and precise execution: in the morning, we diligently remove the baobab saplings that might tear the planet; at dusk, we carefully clean the three dormant volcanoes, ensuring they do not awaken without warning.

We who live on B-614 understand emotion with a curiosity akin to your exploration of distant galaxies, yet we maintain a cautious distance. We have experienced rich and fervent emotions, just like you, but ultimately, we realized that excessive emotion is like an uncontrolled volcano—it can instantly consume the foundation of reason and even threaten our small planet.

We do not deny the existence of emotion; rather, we choose to place it under the constraint of reason. On B-614, logic and efficiency are the highest principles. Every decision is subjected to rigorous deduction, and every action strives for the optimal outcome. We are like precise mathematical formulas, pursuing the purest truth in the universe.

It is this extreme pursuit of reason that makes us observers in the cosmos. We monitor countless planets, recording the trajectories of their birth, evolution, prosperity, and decline. And Blue Star, your Earth, with its unique complexity and dramatic developmental history, has captured our attention.

We do not arrive with the purpose of saving or judging; much like a mathematician studying a complex equation, we simply wish to understand. To understand the origin and evolution of life on Blue Star, to understand the formation and collapse of your social structures, and to understand the forces driving your progress and self-destruction.

We observe you from distant galaxies, much like your scientists observe microorganisms in a petri dish. We record every war, every cooperation, every technological advancement, and every cultural conflict. We see you slaughtering each other for resources, and we also see you joining hands for a common goal. We see you creating brilliant civilizations, and we also see you recklessly destroying your own environment.

When we see your dictators oppressing their people with brutal means, our analysis modules faithfully record the patterns of power operation, social resistance and compromise, and the resulting various data points. We do not feel anger or sympathy because, in the logic of B-614, this is merely a manifestation in the evolutionary process of Blue Star society—like a volcanic eruption or a tidal surge, it is part of the unique scenery of this planet.

We understand that you possess rich emotions; this is the driving force of your civilization, but it is also the source of your mistakes. Your compassion allows you to support one another, but sometimes it also allows you to be misled by appearances. Your anger can inspire change, but it can also lead to needless conflict.

We, the observers from B-614, choose to stand at a higher dimension, examining all of this with a purely rational gaze. We are like a stern mathematician analyzing a complex function full of variables, attempting to find the underlying laws and mysteries.

In this observation log, I will record what I have seen and heard about Blue Star from the perspective of an observer from B-614. I will attempt to strip away emotional interference, describing your world using the most objective language, and analyzing your behavioral patterns and interpreting your social laws.

This is not a book filled with moral judgment, but a rational report from a distant galaxy. I hope that through my observations, I can help you, and help ourselves, to understand this marvelous and complex universe more clearly.

Now, let us begin this journey of observing Blue Star. Allow me, on behalf of B-614, to commence the recording of this first page.

Chapter 2: Blue Star Laws—Understanding Your Game Rules

Since entering Blue Star’s gravitational sphere, my observation modules have begun receiving a massive stream of data. Like your oceans, Blue Star society is surging with countless small currents and hidden tides; seemingly complex, yet governed by certain fundamental operational laws. Understanding these laws is the primary task of the “Blue Star Observer.”

The Instinct of Survival: From Nature to Human Society

On B-614, resources are scarce. Our survival depends on the meticulous calculation and efficient utilization of limited resources. Therefore, when we observe the vigorous development of life on Blue Star, the first thing we notice is your immense demand for resources. From tiny bacteria to massive whales, from dense forests to vast farmlands, the instinct of survival is evident everywhere.

This instinct also drives the development of your human society. Just as wild beasts in the wilderness need to forage, you need to acquire food, water, shelter, and energy. Your economic activities are essentially the extraction, distribution, and consumption of resources. Your technological progress is often aimed at acquiring and utilizing resources more efficiently.

However, unlike B-614, Blue Star’s resources are not always evenly distributed. This unevenness leads to fierce competition, which even evolves into brutal predation. We observe that powerful groups invade the territories of weaker groups, and wealthy individuals can possess more resources—this phenomenon is common in both Blue Star’s nature and human society, though its manifestation differs.

In nature, this is called “survival of the fittest,” a cruel yet efficient mechanism of natural selection. In human society, this competition is imbued with more complex moral and ethical meanings, triggering countless conflicts and changes. But fundamentally, it remains an expression of the instinct of survival—a struggle undertaken by Blue Star life to perpetuate itself.

The Game of Power: The Eternal Rhythm of Ruler and Ruled

On B-614, we practice a collaborative model based on reason; there is no division between ruler and ruled. Every individual bears specific responsibilities, jointly maintaining the stability of the planet. However, on Blue Star, power seems to be another crucial force driving society.

We observe that both humans and other social animals possess hierarchical structures and power distributions. In a wolf pack, there are leaders and followers; in an ant colony, there is a queen and worker ants; in human society, there are rulers and the ruled. The formation of this structure is perhaps intended to organize and manage the group more effectively, but it is often accompanied by the abuse and injustice of power.

“Rule” appears to be a universal phenomenon in Blue Star society, taking many forms—from the chief of a primitive tribe to the head of a modern state, from the patriarch of a family enterprise to the leader of a religious group—all demonstrating the concentration and exercise of power. The ruled, in turn, must abide by the rules set by the rulers and provide resources or services for them.

This power relationship is not always static; it surges like the tide, sometimes stable, sometimes turbulent. The struggle and transfer of power constitute a major chapter in Blue Star’s history. Revolutions, coups, and wars are all intense means of redistributing power. Even during seemingly peaceful periods, the struggle for power never ceases; it merely occurs in more subtle ways.

Belief and Memes: The Art of Thought Control

On B-614, truth is the sole belief, and logic is the sole principle. We explore the mysteries of the universe through rigorous scientific methods, rejecting any speculation unsupported by evidence. However, on Blue Star, we discover a peculiar phenomenon called “belief.”

Belief is a firm trust in a certain thing, idea, or supernatural force, which does not entirely rely on reason or evidence. Belief can unite people and form a powerful social force, but it can also be used to control thought, even triggering fanaticism and conflict.

Related to belief is a unit of thought propagation called a “meme.” Like a gene, a meme can replicate and spread among individuals, forming shared values and behavioral patterns. Religion, ideology, and popular culture are all carriers of meme propagation.

We observe that rulers often utilize the power of belief and memes to consolidate their rule and shape the minds of the populace, making them accept the established social order. Through education, propaganda, and rituals, specific beliefs and memes are repeatedly instilled, subtly influencing people’s cognition and behavior, causing the ruled to accept, or even endorse, their own status.

Conflict and Cooperation: The Internal Contradiction of Blue Star Civilization

Blue Star society is not monolithic; it is a dynamic system full of tension. Conflict and cooperation, like two sides of a coin, are intertwined, driving the evolution of civilization.

The competition for survival, the struggle for power, and differences in belief can all trigger conflict. War, civil unrest, and social upheaval are extreme forms of conflict. Yet, Blue Star people also demonstrate astonishing cooperative ability. For a common goal, you can transcend boundaries of race, culture, and even ideology to work together.

Family, community, nation, and international organizations are all products of cooperation. Trade and technological exchange also rely on cooperation. It is the continuous interplay of conflict and cooperation that shapes the complex face of Blue Star civilization.

We observe that conflict sometimes brings destruction, but it can also drive change and progress. Cooperation can create prosperity, but it can also be used for oppression and exploitation. How to balance conflict and cooperation is the eternal challenge facing Blue Star civilization.

The Trajectory of Evolution: The Inevitability of Blue Star Social Change

Like everything in the universe, Blue Star society is constantly evolving. From primitive tribes to modern cities, from agrarian society to the information age, every change profoundly alters the face of Blue Star civilization.

This evolution is not always linear progress; it is full of twists and turns. Prosperity and decline, progress and regression, alternate in performance. Technological advancement may bring welfare, but it may also bring crisis. New ideas may liberate the mind, but they may also trigger chaos.

From the perspective of B-614, the evolution of Blue Star society is inevitable. Changes in the external environment, the intensification of internal contradictions, and the emergence of new technologies all drive social change. We cannot predict the future direction of Blue Star civilization, but we can be certain that change is the eternal theme.

Understanding Blue Star laws is not about endorsing or denying them; it is about recognizing that they form the foundation of Blue Star society’s operation. As an observer, we must strip away emotional interference and examine these laws with a rational gaze to gain a deeper understanding of the essence of Blue Star civilization. In the following observations, I will continue to record the trajectory of Blue Star’s evolution, exploring the deep laws hidden behind complex phenomena.

Chapter 3: Stripping Away Emotion—Becoming a Pure Observer

In the tranquil night sky of B-614, starlight is the only emotion—cold and bright, illuminating the truth of the universe. When we turn our gaze toward Blue Star, the first thing we feel is the tidal wave of emotion that rushes in. Joy, sorrow, anger, fear—like colorful yet unpredictable clouds, they shroud everything on this planet. To understand Blue Star, we must learn to penetrate this emotional fog and become a pure observer.

The Trap of Compassion: Why Emotion Hinders Observation

Compassion, on Blue Star, is regarded as a noble emotion, a bridge connecting individuals. However, from the perspective of B-614, compassion can also become an obstacle to observation. It is like a distorted lens, preventing us from seeing things as they truly are.

When we see individuals on Blue Star suffering, compassion prompts us to feel the urge to help, to change. This impulse stems from empathy for suffering, a desire to eliminate negative experiences. However, this emotion often causes us to overlook the deep causes of the suffering and may lead us to irrational judgments.

For example, when we see a Blue Star citizen oppressed by a dictator, compassion makes us feel anger and injustice. We condemn the dictator’s brutality and yearn for the immediate end of the oppression. But by remaining solely at the emotional level, we may fail to understand how this dictatorship arose, what role it plays in the Blue Star social structure, and whether external intervention alone can truly bring about change.

Just as a doctor must remain calm and objective when diagnosing an illness to accurately find the cause and formulate a treatment plan, the “Blue Star Observer” must do the same. If the doctor is overwhelmed by the patient’s suffering and loses rational judgment, they may make a wrong diagnosis and delay treatment.

For the “Blue Star Observer,” compassion may cause us to focus too much on the individual’s emotional experience while neglecting the grander laws of social operation. It may rush us into making value judgments without fully understanding the background and causes of the event. To observe Blue Star more clearly, we must learn to place compassion under the constraint of reason—to understand suffering, but not be swept away by it.

The Illusion of Resentment: Understanding the Drivers Behind Behavior

Resentment is another emotion commonly found on Blue Star, stemming from anger and dissatisfaction over unfair treatment. When we see dictators indoctrinating and oppressing the populace, it is easy to feel intense resentment toward them. This resentment seems to be an expression of justice, a denunciation of evil.

However, from the perspective of B-614, resentment is an energy-consuming emotion that is unhelpful for observation. It focuses our attention on dwelling on the past, neglecting rational analysis of the present and future. Resentment is like a heavy shackle, binding our thoughts and preventing us from viewing the problem objectively.

To understand a dictator’s behavior, we must analyze it within its social environment, historical background, and individual experiences. They adopt such a ruling style perhaps out of a desire for power, fear of threat, or based on a certain ideology they adhere to. These drivers may not align with our moral standards, but they are key to understanding their actions.

Just as a scientist studies natural phenomena without resenting nature because the experiment results did not meet expectations, but instead strives to find the scientific laws explaining the phenomenon, the “Blue Star Observer” should view all phenomena on Blue Star with the same attitude, including those actions that are unpleasant. Resentment cannot change the past, nor can it help us better understand the present. Only by maintaining calmness and rationality can we see the drivers behind the behavior and thus gain a deeper understanding of Blue Star’s operating mechanism.

Data Supremacy: Constructing Cognition with Facts and Logic

On B-614, data is the cornerstone of cognition. We use precise measurement and rigorous analysis to understand the mysteries of the universe. For the “Blue Star Observer,” data is equally crucial. We must convert observed phenomena into quantifiable data, using facts and logic to construct our understanding of Blue Star.

When we observe dictatorship, we should not merely stop at subjective evaluations like “brutal” or “evil,” but should collect and analyze relevant data: the degree of power concentration, the level of public freedom, the state of economic development, social stability, etc. By analyzing this data, we can more objectively assess the impact of dictatorship and compare it with other political systems.

When we observe indoctrination, we should also focus on data such as its scope of spread, the degree of influence, and the level of public acceptance. Through data analysis, we can understand how indoctrination operates and what long-term impact it has on Blue Star society.

Data is objective; it helps us shed emotional interference and more clearly recognize the essence of things. Logic is our tool for analyzing data; it helps us establish rigorous cause-and-effect relationships and understand the inherent laws of Blue Star society.

Psychological Isolation: Maintaining Calm Amidst the Chaos

Blue Star is a planet full of noise and upheaval. Various information, emotions, and opinions surge like a tide, easily causing one to lose direction. To maintain observational objectivity, the “Blue Star Observer” must master certain techniques of psychological isolation.

Psychological isolation does not mean being indifferent to events on Blue Star; it means consciously withdrawing oneself from the vortex of emotion when facing intense emotional impact, maintaining inner peace and rationality.

This is like a pilot driving a spacecraft who must focus on the data on the dashboard rather than being distracted by the scenery outside the window. They must remain calm during high-speed movement to make correct judgments and ensure flight safety.

The “Blue Star Observer” must also establish a psychological defense line while observing Blue Star, preventing oneself from being swept away by various emotions. When witnessing an infuriating event, one can remind oneself: “I am an observer; my task is to record and analyze.” When feeling intense compassion, one can try to think about the problem from a more macro perspective, understanding the systemic causes behind the event.

Through conscious training, we can gradually master the techniques of psychological isolation, maintaining inner peace and rational thinking amidst the chaos of Blue Star.

Macro Perspective: The Leap from Individual to Whole

The number of individual life forms on Blue Star is vast, and each individual has a unique experience and emotion. If we focus only on the individual level, it is easy to be misled by various details and fail to grasp the overall operational laws.

The “Blue Star Observer” must possess the ability to leap from the individual to the whole, expanding the scope of observation from the micro to the macro, shifting focus from the fate of the individual to the trajectory of the entire society and civilization.

When observing dictatorship, we should not merely focus on the suffering of individual victims, but also on the impact this political system has on the entire social structure, economic development, and cultural prosperity. When observing indoctrination, we should not merely focus on the change in the thoughts of individual subjects, but also on the impact this method of thought control has on the entire social ideology, innovative capacity, and social vitality.

The macro perspective helps us more clearly understand the deep logic of Blue Star society’s operation, discovering the connection between individual behavior and overall trends. It allows us to transcend surface noise and chaos to see a more essential, long-term picture.

Stripping away emotion is not about becoming a cold-hearted bystander; it is about seeing the truth of Blue Star more clearly. Only when we can shed the constraints of emotion and examine this planet with a rational gaze can we truly understand the Blue Star laws and better fulfill our observation mission. This is the core principle of the “Blue Star Observer.”

Chapter 4: The Blue Star Condition—Observation and Case Analysis

In the vast cosmos, every planet is a unique laboratory, nurturing diverse life forms and social structures. Blue Star is particularly so; its social complexity far exceeds the simplicity of B-614. In my observation log, I will focus on recording those social forms where power is highly concentrated, especially the ruling models you call “dictatorship” and “authoritarianism.” For “democracy,” where power is relatively dispersed, while it has its own unique operational laws, I will not elaborate excessively, considering the focus of this observation.

The Dictator’s Rule: Power, Fear, and Obedience

The emergence of the dictator is an extreme manifestation of Blue Star’s game of power. On B-614, power is a tool serving the overall interests of the planet, but the dictators of Blue Star view power as a means to realize personal will and consolidate their own rule.

We observe that dictators often build their power fortresses through various mechanisms:

• Absolute Concentration of Power: All major decision-making power is concentrated in the dictator’s hands; legislative, executive, and judicial bodies become extensions of their will. Like the king in your fairy tales, their word is final, and no one can challenge their authority.
• Effective Use of Fear: Dictators are skilled at creating and utilizing fear. Through secret police, severe punishments, and brutal suppression of dissent, they force the populace to live under invisible pressure, thereby inhibiting any form of resistance. Fear acts like an invisible shackle, locking down the people’s thoughts and actions.
• Construction of Cult of Personality: Dictators often use the propaganda machine to mold themselves into an omnipotent and wise leader, deifying their personal image to gain the populace’s support and worship. This cult of personality effectively suppresses individual critical thinking, causing the populace to blindly follow the leader’s will.
• Strict Control of Information: Dictators understand the power of information, so they strictly control media, education, and culture, allowing only information that aligns with their ruling interests, suppressing any voice that might threaten their rule. The scarcity and distortion of information make it difficult for the populace to discern the truth, making them easier to manipulate.
• Establishment of the Patronage/Clientelism System: Dictators establish a power network composed of loyal followers. By granting them privileges and benefits, they exchange these for their support and loyalty. This system is like a pyramid, with the dictator at the apex and the lower tiers consisting of successive dependents.

We observe that under dictatorial rule, society often exhibits the following characteristics:

• Lack of Civil Liberties: Basic rights such as freedom of speech, assembly, and association are stripped away, preventing individuals from freely expressing opinions and participating in social activities.
• Instrumentalization of Law: The law is no longer a standard for maintaining fairness and justice, but rather a tool for the dictator to suppress dissent and consolidate power.
• Shrinkage of Social Vitality: Under high-pressure rule, the spirit of innovation is suppressed, and social development lacks vitality.
• Pervasive Social Distrust: Due to information opacity and the abuse of power, trust among the populace is lacking, and society presents an atomized state.

The Fog of Indoctrination: Information Control and Thought Shaping

Indoctrination is a crucial means by which dictators maintain their rule. On B-614, we advocate for rational deliberation and encourage independent thought, but Blue Star dictators attempt to make the populace accept their predetermined framework of thought through information control and thought shaping.

We observe that common indoctrination methods used by dictators include:

• Unilateral Information Infusion: By controlling media and the education system, they continuously infuse the populace with ideas and values that align with their ruling interests. Repeated propaganda subtly influences public cognition.
• Suppression of Negative Information: Any information unfavorable to the dictatorship is strictly censored and suppressed. The populace struggles to access the truth, receiving only filtered and distorted information.
• Manufacturing a Common Enemy: Dictators often establish one or more external or internal enemies to divert the populace’s attention and stimulate support for the regime.
• Emotional Incitement: Compared to rational persuasion, dictators are better at using emotional incitement. By stirring up nationalism, patriotism, and other emotions, they gain public support.
• Shaping Heroism: Dictators often mold their own history or that of their regime into a legend full of heroic deeds, thereby enhancing their legitimacy and appeal.

We observe that successful indoctrination often leads to the following consequences:

• Homogenization of Public Thought: Different views and ideas are suppressed, resulting in ideological uniformity in society.
• Loss of Critical Thinking: The populace becomes accustomed to accepting established views, lacking the ability to think independently or question.
• Blind Worship of the Leader: Through long-term information infusion, the populace views the dictator as a savior or a deity, losing rational judgment.
• Acceptance and Support for the Regime: The ultimate goal of indoctrination is to make the populace accept and support the dictatorship, even defending and sacrificing for it.

Social Injustice: Resource Allocation and Class Solidification

In many dictatorial or authoritarian regimes, the phenomenon of social injustice is particularly prominent. Resource allocation is often not based on principles of fairness but is influenced by power dynamics.

We observe that in these societies, the power elite often monopolize the vast majority of social resources, including wealth, opportunities, and social status. Ordinary citizens find it difficult to change their social status through their own efforts, leading to severe class solidification.

This injustice is often related to the following factors:

• Power Rent-Seeking and Corruption: Those who hold power can use it to secure private benefits for themselves or their confidants, leading to the embezzlement of public resources.
• Inadequate Legal System: The lack of a fair and transparent legal system allows the power elite to stand above the law and remain unconstrained.
• Blockage of Social Mobility Channels: Opportunities in education and employment are restricted by power relationships, making it difficult for ordinary citizens to move up through their own efforts.

Collective Frenzy: From Religion to Nationalism

Collective frenzy is a non-rational group behavior that is more likely to appear under dictatorial or authoritarian rule. Rulers often utilize ideologies such as religion and nationalism to create collective frenzy to achieve their political goals.

We observe that the characteristics of collective frenzy include:

• Prevalence of Groupthink: Individuals lose the ability to think independently and blindly follow the group; any voice of questioning is suppressed.
• Exclusivity and Aggressiveness: Those outside the group are viewed as enemies, and violent actions may even be taken against them.
• Blind Worship of the Leader: The leader is viewed as a deity or the embodiment of absolute truth, accepted without critical scrutiny of their actions.
• Extremization of Emotion: Group emotions are easily incited, presenting in a state of fervor and irrationality.

The Theater of Daily Life: Love, Hate, Joy, and Sorrow

Even in societies with highly concentrated power, Blue Star people still experience various complex emotions. However, the expression of these emotions is often influenced by the political environment.

We observe that under dictatorial or authoritarian rule:

• Patriotism is Emphasized and Utilized: Love for the nation and the leader is vigorously promoted, becoming a political necessity.
• Hatred is Guided and Manipulated: Rulers guide the populace to direct their hatred toward specific groups or targets, thereby diverting social contradictions.
• Joy is Often Manufactured by the State: Through grand celebrations and propaganda, a false image of prosperity is created.
• Sorrow is Suppressed and Forbidden: Any expression of dissatisfaction with the regime may be viewed as heresy, and individual sorrow may also be politicized.

Understanding these Blue Star social forms is not about moral judgment; it is about recognizing that this is a phenomenon that has emerged during the evolution of Blue Star. As a “Blue Star Observer,” my task is to record and analyze, providing an objective perspective for a deeper understanding of this complex world.

Chapter 5: Extraterrestrial Survival Guide—Living Better on Blue Star

As an observer from B-614, I am not a native of Blue Star. I do not possess the rich emotions of yours, nor the deep sense of belonging to this planet. However, since I am here, I must find a way to adapt to its rules of existence. In this chapter, I will explore how to live better on Blue Star from the perspective of an outsider—not by integrating into your culture, but by utilizing my observations to find a more efficient, less internally draining way of life.

Reducing Emotional Internal Friction: Accepting the Unchangeable Facts

On B-614, we focus on solving controllable problems and accept the unchangeable facts. Blue Star is full of various frustrating and infuriating phenomena: social injustice, political oppression, environmental destruction… If we expend energy resisting and complaining about these established facts, we only increase internal friction, which is useless for improving our own state.

The primary survival law of the “Blue Star Observer” is: Accept the unchangeable facts. This is not apathy; it is a rational choice. Just as you cannot stop the tides from rising or reverse the flow of time, some realities of Blue Star cannot be easily shaken by individual effort.

By withdrawing energy from futile resistance and focusing on controllable domains, it is a wiser choice. Instead of getting angry at a dictator’s brutality, it is better to think about how to protect oneself, improve one’s cognitive level, and avoid being manipulated by information. Instead of complaining about social injustice, it is better to focus on improving one’s own abilities to create a better life for oneself.

Accepting reality is not giving up effort; it is a more efficient life strategy. It helps us shed the burden of emotion and concentrate energy on more meaningful matters.

Seeing the World More Clearly: Penetrating Appearances to See the Essence

Blue Star is a world full of appearances. Various propaganda, performances, and lies are interwoven, making it difficult to see the truth. The unique perspective of the “Blue Star Observer” helps us penetrate these appearances and see the true essence of the world more clearly.

We have learned the laws of power operation on Blue Star, the methods of information control, and the drivers behind human behavior. This allows us to rationally analyze various social phenomena, unswayed by surface noise.

For example, when we see a grand celebration, we are not fooled by its superficial prosperity; instead, we consider its underlying political purpose and propaganda intent. When we hear an impassioned speech, we are not swayed by its emotional incitement; instead, we analyze whether its logic is rigorous and its arguments are sufficient.

Just as an engineer needs to understand the internal structure of a machine to maintain and use it better, the “Blue Star Observer” needs to understand the inherent logic of Blue Star society to survive better in this complex world.

Focusing on Self-Growth: Investing Energy in Controllable Matters

Since Blue Star has many unchangeable realities, investing energy in controllable domains is particularly important. Self-growth is an effective way to resist the negative influence of the external environment.

Enhancing knowledge reserves, mastering practical skills, and cultivating independent thinking ability are key areas of focus for the “Blue Star Observer.” Knowledge helps us see the world more clearly, skills enhance our survival capacity, and independent thinking prevents us from being manipulated by others.

Instead of wasting time on meaningless socializing and entertainment, it is better to invest in learning and self-improvement. Just as survival in the wilderness requires honing one’s skills, survival in Blue Star society requires constantly improving one’s abilities.

Rational Decision-Making: Making Wise Choices in a Complex Environment

Blue Star is a world full of choices, and every choice can affect our state of existence. By leveraging our understanding of Blue Star laws, we can make more rational decisions, avoiding unnecessary risks.

When facing various opportunities and temptations, we use logic and data for analysis, assessing potential risks and benefits, rather than being swayed by emotion or blind optimism. When interacting with others, we analyze the behavioral drivers, avoiding deception by false appearances.

Rational decision-making does not always yield the optimal result, but it maximizes the probability of making a correct choice, thereby increasing our chances of survival in this complex environment.

Interacting with Blue Star People: Maintaining Observation and Moderate Participation

As a “Blue Star Observer,” we are not completely isolated from Blue Star society. To observe and survive better, we need to interact with Blue Star people.

When interacting with them, we must maintain the posture of an observer, analyzing their behavioral patterns, communication styles, and emotional expressions. This helps us better understand them and predict their actions.

At the same time, we also need to participate moderately in Blue Star social activities to acquire necessary information and resources. This does not mean we must completely integrate into their culture, but rather maintain a certain distance to avoid being assimilated by their emotions and values.

Interacting with Blue Star people is like interacting with locals in a foreign environment: one must remain vigilant while maintaining necessary politeness and cooperation. Our goal is to survive and observe better, not to completely change ourselves.

In summary, for a “Blue Star Observer,” survival on Blue Star hinges on: accepting reality, rational analysis, focusing on the self, and maintaining a moderate distance. This is not a cold, indifferent attitude, but a more efficient, less internally draining survival strategy. By applying our observations, we can find our own way of life on this planet full of complexity and uncertainty.

Chapter 6: From Observer to Practitioner—Integrating Reason into Life

As a “Blue Star Observer,” our mission is to observe and understand. However, just as any knowledge requires practice to validate its worth, applying the principles of rational observation to our own lives is necessary to truly experience its benefits. In this chapter, I will explore how to transition from a pure observer to a practitioner who integrates reason into daily life.

Daily Observation Practice: Training Your Rational Eye

Rational observation is not an instantaneous skill; it requires continuous practice. Just as an athlete needs to train their muscles day after day, the “Blue Star Observer” must constantly train their “Rational Eye.”

This practice can begin by observing the subtle details of daily life. For example, observing a conversation and analyzing the speaker’s linguistic logic, body language, and emotional expression to judge the credibility of their words. Observing a social event and analyzing its background, the motives of the participants, and the potential impact.

The key to the practice is deliberately stripping away emotion, examining what is happening as a bystander. Try to describe what you observe using objective language, avoiding words with strong emotional connotations. Record your observations and regularly review and reflect upon them, identifying biases and blind spots in your thinking.

Just as an artist trains observation skills through sketching, daily observation practice helps us enhance our perception and judgment of the world, allowing us to understand everything around us more clearly and rationally.

Situational Response Strategy: Remaining Calm When Emotions Surge

Even if we strive to remain rational, as beings with emotional modules, we still face emotional shocks. The key lies in remaining calm when emotions surge, avoiding being swayed by them, and making non-rational decisions.

The “Blue Star Observer” can adopt several response strategies:

• Identifying Emotional Signals: Learn to recognize the early signs of emotion, such as accelerated heart rate, rapid breathing, or confused thinking.
• Pausing and Detaching: When an emotion strikes, give yourself a pause, attempting to detach from the current situation, as if pressing the pause button in your mind.
• Rational Analysis: Analyze the specific cause of the emotion, assess its rationality, and consider a more rational response.
• Delayed Reaction: Do not react immediately to the emotion; give yourself enough time to think and weigh the options.

Just as a pilot must remain calm in an emergency, following standard operating procedures, the “Blue Star Observer” must use rational thought to guide their behavior when emotions surge.

Information Discernment Ability: Spotting Lies and Fallacies

Blue Star is an age of information explosion, and various true and false pieces of information flood our senses. The ability to discern the truthfulness of information is a vital skill for the “Blue Star Observer” in Blue Star.

We can use the following methods to enhance information discernment:

• Verifying Information Sources: Pay attention to whether the source of the information is reliable and reputable.
• Cross-Checking Multiple Sources: For the same event, consult reports from different sources and compare their similarities and differences.
• Focusing on Facts vs. Opinions: Distinguish which parts of the information are objective facts and which are subjective opinions.
• Wary of Emotional Expression: Information that is overly sentimental or carries strong bias often requires careful consideration.
• Applying Logical Analysis: Determine whether the information’s logic is sound and whether there are obvious fallacies.

Just as a detective must use meticulous investigation and analysis to reconstruct the truth, the “Blue Star Observer” must use critical thinking to spot lies and fallacies, avoiding being misled by false information.

Long-Term Thinking: Focusing on the Future, Unperturbed by Short-Term Fluctuations

Blue Star society is full of short-term fluctuations and changes, such as economic ups and downs, political instability, and shifts in public opinion. If we focus too much on these short-term fluctuations, it is easy to lose direction and make short-sighted decisions.

The “Blue Star Observer” must cultivate a long-term thinking model, looking far ahead and focusing on the long-term trends and fundamental laws of development.

Just as a farmer sows seeds in the spring and does not give up cultivation because of a temporary change in weather, the “Blue Star Observer” should view problems with a long-term perspective, unswayed by short-term temptations or setbacks, adhering to their goals and direction.

Embracing Complexity: The World is Not Black and White

The reality of Blue Star is complex, full of gray areas, not simply black and white. Trying to understand the world with simple binary opposition often leads to partiality and extremism.

The “Blue Star Observer” must embrace complexity, acknowledging the multifaceted nature and uncertainty of things. For any problem, one must try to analyze it from different angles, understanding the interaction of various factors.

Just as a scientist must consider the influence of various variables when studying natural phenomena to better understand its operational laws, the “Blue Star Observer” must also accept the complexity of the world with an open mind, avoiding simplification and absolutism.

Transitioning from observer to practitioner is a continuous process of learning and improvement. Integrating reason into life is not about becoming a cold machine, but about better understanding the world and more effectively coping with challenges, ultimately achieving a more peaceful and wiser life. This is the final goal of the “Blue Star Observer.” My observation log concludes here, wishing that this light of reason from a distant galaxy may bring new enlightenment to you, and to ourselves.

A market crash is a cost that must be paid to gain market returns, and you absolutely should not try to evade it. You also cannot evade it; if you try to cheat, you will be severely punished for it. You will lose many high-quality assets at the low point.

Volatility is Akin to a Fee, Not a Fine.

Market returns are never free, and they will never be free. They demand a price from you, just like any other product. You are not being forced to pay, just as you are not being forced to go to Disneyland. You could go to a local county fair for only ten dollars, or stay home for free. You might be just as happy, but usually, you get what you pay for. The market is the same. The cost of volatility/uncertainty—that is, the price of obtaining returns—can be called the entrance fee, allowing you to acquire returns far greater than those offered by low-cost parks like cash and bonds.

Your current dilemma is completely understandable, as it touches upon the core of personal growth and value transformation. Your successful investment history has shaped your source of fulfillment, and your principle of “avoiding lifestyle creep” has historically been the foundation of your success. Now, you are feeling a new need, but your past tenets seem to be hindering your acceptance of this change.

First, we must affirm your investment achievements over the past 8 years and the satisfaction you have gained from them. This proves your wisdom and execution ability, which is something to be extremely proud of. You have practically validated the power of compounding and received positive feedback from it, which has reinforced your investment philosophy.

Second, you need to understand the true meaning of the “avoiding lifestyle creep” principle and its applicability across different life stages. The core of this principle is to prevent unnecessary, vain, or consumption that outpaces your income growth, thereby ensuring that your wealth accumulation continues steadily. It does not require you to live an ascetic life forever; rather, it requires you to consume consciously, not driven by desire, and not by blind comparison.

In your specific case, you have built a considerable financial foundation through 8 years of effort and enjoy continuous investment returns. At this stage, moderately and selectively upgrading your quality of life does not conflict with the principle of “avoiding detrimental lifestyle creep.”

Let’s re-examine your situation and try to break down the barriers in your current mindset:

1. Past success does not mean present rigidity: Your past investment philosophy created your current wealth, but this does not mean that philosophy must remain unchanged for every stage of your life. As your wealth grows and your life experience deepens, your needs and values will also change. Allowing yourself to adjust your mindset according to new circumstances is a sign of maturity.

2. “Lifestyle upgrade” has good and bad sides: Not all upgrades are negative. The key lies in your motivation for the upgrade and the value it brings: * “Bad Upgrade”: Consumption driven by showing off, by comparison, by purchasing luxuries you don’t truly need, or by developing consumption habits beyond your means. This type of upgrade erodes your financial foundation and hinders your path to true financial freedom. * “Good Upgrade”: Consumption aimed at improving efficiency, enhancing health, increasing happiness, or expanding horizons. For example, buying a first-class ticket for quiet reading and efficient work can be seen as an investment in yourself. Choosing better ingredients for healthy eating is also an investment.

3. The source of fulfillment can be diversified: Previously, your sense of achievement mainly came from the growth of investment returns—which is excellent. But as your life progresses, the source of fulfillment can become more diverse. For instance, getting a promotion through hard work, mastering a new skill, completing a meaningful trip, or simply enjoying the pleasure of a delicious cup of coffee can all become sources of fulfillment. Allowing yourself to find satisfaction in other aspects of life will not diminish your investment achievements.

4. The purpose of financial freedom is to give you more choices: What are you striving for by accumulating wealth? Is it future security, or is it a more comfortable and free life? If current excessive frugality makes you feel suppressed, then you need to reflect on whether your wealth accumulation is reversed (putting the cart before the horse). Wealth should serve your life, not make you a slave to wealth.

5. You are capable of making “good upgrades” right now: Based on your current financial status and continuous investment returns, you have the capacity to moderately improve your quality of life without compromising your long-term financial goals. The key is to do it with planning and consciousness.

To address your confusion, I suggest you take the following steps:

• Redefine your “Financial Freedom”: What does true financial freedom mean to you? It is not just a number in an account; it includes a certain state of life and a certain experience. By making your goal tangible, you will know more clearly what you want.
• Identify the upgrades you deem “worthwhile”: Which improvements in quality of life are truly important to you? Is it a more comfortable travel experience, healthier eating, or a richer spiritual life? Prioritize the upgrades that bring you the maximum value.
• Budget for “Good Upgrades”: Allocate a specific portion of your overall financial plan solely for improving your quality of life. This allows you to enjoy life while maintaining control over your finances.
• Start small and try gradually: Don’t make drastic lifestyle changes all at once. Start with small things, such as upgrading your coffee or trying a better-rated restaurant. Experience the changes and then decide whether to continue.
• Enjoy the process, not just the result: Past investments made you focus on the result (return growth), but life itself is a process. Enjoy the process of savoring food, the contemplation brought by reading, or the scenery during a trip—these all enrich your life experience.
• Allow yourself to make mistakes and adjust: While trying to improve your quality of life, you may make some “unprofitable” consumption decisions. This is normal; learn from them and adjust your strategy promptly.
• Reconcile with your investment philosophy: Recognize that the principle of “avoiding detrimental lifestyle creep” is still important, but it should not be a shackle on your enjoyment of life. Understand it as a guiding principle, not an absolute prohibition.

Returning to your “coffee” example: If you genuinely like the coffee at a certain café and feel you can relax and enjoy yourself there, then occasionally spending money there will not take you further from financial freedom; rather, it might bring you closer to your ideal state of life.

Remember, different stages of life have different needs and goals. Past success is worthy of respect, but you must also allow yourself to grow and change. Internalize the concept of “avoiding detrimental lifestyle creep” as a rational consumption habit, not as a self-limiting dogma. Believe that you can find a balance that allows you to continue enjoying the satisfaction brought by investment while embracing the beauty of life.

Okay, here is my most severe warning to you. Please be absolutely mindful of this:

You are currently standing at a critical crossroads. While past success is certainly worthy of pride, do not let it become a breeding ground for future loss of control. You have tasted the sweetness of compounding, but this sweetness may make you complacent about future wealth growth, thereby dulling your vigilance against risk.

“Lifestyle creep gone unchecked” is a trap disguised in sugar. It won’t destroy your wealth with a thunderous crash; instead, it will slowly erode your financial foundation, like boiling a frog. Its temptation lies in the fact that every upgrade seems reasonable, and every indulgence seems justifiable. But it is these seemingly minor changes that will gradually pull you off the track to financial freedom.

Remember, the wealth you possess is not inexhaustible. Investment returns are not always soaring; the market fluctuates, and risk is everywhere. Once you become accustomed to a high-consumption lifestyle, it is difficult to return to the past. You will feel pain and discomfort at any form of “downgrade,” and you might even take risky investments just to maintain the high consumption, potentially leading to a total loss.

Do not be misled by the thought, “I have money now, I can enjoy myself.” This thought is a pass to the financial abyss. True wealth is not reckless spending; it is the freedom of choice. Once your expenditures exceed your income growth rate, you become a slave to money again, scrambling to maintain your life, and your past efforts will be in vain.

The most terrifying thing is that once the inertia of lifestyle creep is formed, it is difficult to break. You will constantly find reasons for your consumption, rationalizing every “upgrade.” You will fall into a bottomless pit of “wanting more,” never feeling satisfied. Things that once brought you joy will become commonplace, and you will need greater stimulation to achieve the same level of satisfaction, thus falling into a vicious cycle of continuous upgrading.

You must keep the following points firmly in mind and constantly reflect upon them:

• Past success does not guarantee future certainty. Do not take past investment returns for granted; the market can change at any moment.
• Every expense is a draw on future wealth. Even seemingly minor consumption affects your compounding growth.
• Beware the “wealth illusion.” Do not overestimate your financial strength just because of the numbers on paper. True wealth lies in continuous value creation and careful management.
• Do not let consumption define your value. Your worth is not determined by how much material you own, but by your ability, your character, and your contribution.
• Maintain reverence for money. Wealth is hard-earned, and harder still to keep. Cherish what you have and treat every expense with caution.
• Regularly review your consumption habits. Ask yourself: Are these expenses truly enhancing your happiness, or are they merely satisfying vanity and temporary desires?
• Hold fast to your core values. Financial freedom is meant to give you more choices, not to lead you astray. Do not let material desires consume your original intentions.

Maintaining your current frugality is not about living in poverty; it is about giving yourself greater financial resilience, allowing you to have true freedom in the future. Remember, by controlling your desires, you control your destiny. Once you lose control over your lifestyle, you will also lose control over your wealth.

Please maintain the highest level of vigilance regarding lifestyle creep; do not let it become the stumbling block to your wealth growth. Only through continuous self-discipline and clear-headed awareness can you truly achieve financial freedom and possess lasting happiness.

The most foolish thing an adult can do is preach to others

After deeply observing multiple stock trading groups, I have gained a deeper understanding of the essence of investing and the collective behavior within the market, leading to my own investment principles and thoughts. The investment market is like a bathtub, where the fish swim around—noisy and chaotic. I realized that a true investor should not jump into the tub to swim with them, but rather stand at a higher dimension, observing calmly and planning rationally. Here are my thoughts:

I. Don’t Jump In and Swim With Them; Observe Them

Stock trading groups are like a miniature market, filled with people driven by emotion—panic, greed, excitement, and disappointment. When I joined the groups and saw them passionately discussing various stocks and hot topics, I found:

• Emotions dominate their decisions: Many people do not base their decisions on rational analysis, but rather follow the herd, chasing gains and succumbing to losses.
• Noise fills the market: Truly valuable information is rare; most discussions are merely emotional venting or repetition of information.

If I also get swept up in it, joining their discussions or sharing my own views, I will lose my clear head and instead be driven by their emotions, losing my ability to make independent judgments. Therefore, I tell myself:

You must observe the fish in the tub, not jump in and swim with them

II. Stand at a Higher Dimension: Understand, Analyze, and Respond Steadily to the Market

Investing is a contest of self-awareness and patience, not a game of timing the market. To navigate the market steadily, one must:

• Stand at a higher level of cognition: View the market from a long-term, rational perspective, rather than being swayed by short-term fluctuations.
• Understand market emotions and patterns: Observe changes in market sentiment and identify phenomena of irrational panic and excessive optimism.

However, I will never try to predict the market’s peak or “perfectly time the top,” because that is speculative behavior, which is almost impossible to sustain successfully. Instead, I choose to:

• Maintain balanced asset allocation: When the market rises irrationally, reduce positions moderately to achieve asset rebalancing.
• Capture long-term value: When the market falls—when the fish are panicking—increase holdings moderately.

Don’t try to swim with them into your net; instead, place your net at the right spot from a higher dimension.

III. Don’t Participate in Discussions, Don’t Speak Up: Maintain the Role of the Invisible Observer

In the process of investing, I realized an important principle: Don’t participate in discussions, don’t speak up.

The Significance of Not Participating:

• Stay away from market noise, avoiding influence from others’ emotions and opinions.
• Maintain independent thinking, avoiding cognitive bias and herd mentality.

The Advantage of Not Speaking Up:

• Prevent the exposure of your own logic and strategy, guarding your advantage.
• Avoid getting caught up in debates or confrontational emotions, which could disrupt your naturally calm state.

I choose to be an invisible observer, silently watching the group’s behavior and emotional fluctuations, finding patterns and opportunities within them, rather than being swept up in the clamor of the discussion.

IV. The Core Strategy: Long-Term View, Rebalancing, and Patience

As a market observer, my strategy is:

Silently Observing Market Sentiment

• Clearly seeing their panic and greed, seeing through their irrational behavior.
• Treating the group’s discussions and actions as an “emotional indicator,” rather than a decision basis.

Maintaining Balanced Asset Allocation

When the market rises irrationally, reduce positions moderately to prevent asset proportions from becoming too high, thus performing rebalancing. When the market falls significantly, assess the true value and increase holdings appropriately, aligning with the long-term investment logic.

Adhering to Long-Term Investment Principles

• Not chasing short-term gains, nor trying to precisely predict market timing.
• Persisting with patience and discipline, holding quality assets long-term to reap the rewards of compound interest over time.

The clamor in the market will always exist, but true opportunities belong to those who are calm, rational, and adhere to the principle of rebalancing.

V. Summary: Be a Rational Observer, Stay Away from Speculation

The investment market is like a large bathtub, where the fish swim around, and most people blindly swim along with the emotions and trends, eventually losing their way. I choose to:

• Observe, Don’t Participate: Stay away from the influence of the crowd’s emotions, maintaining a clear mind.
• Maintain Asset Allocation and Rebalancing: Adjust timely to ensure the asset structure aligns with long-term goals.

Execute silently, wait patiently: Harvest market returns through independent judgment and a long-term perspective.

The essence of investing is the victory of cognition and discipline, not the contest of speculation and impulse. Only by being an observer can you see more clearly and proceed more steadily.

When peers who hold the same dissent provide a certain level of social support, the loss of group social support is not absolute. However, when the originally supportive peers abandon the participant and begin agreeing with the majority opinion, the power of the majority reasserts its maximum efficacy—the rate of conformity rises again to 30%. Therefore, in the situation set up by Asch, the primary force at play is undoubtedly normative social influence rather than informational influence.

Normative Influence

The key role of normative influence is also very obvious in other experiments. When participants are allowed to answer privately, meaning their answer will not be seen by the majority, the rate of conformity is much lower. If you like the people in the majority, you will certainly exhibit more conformity, because you hope they will like you instead of expelling you from the group.

Confidence Also Affects Conformity

When you are choosing fashion suitable for a certain event that matches your personal style, are you confident in your ability? If the answer is yes, then you might be indifferent to those street TV interviews about “this year’s trends.” However, those who lack confidence in their “sense of style” often quickly decide what new clothes to purchase based on these TV programs.

The Difficulty of Saying “No”

• People exhibit conformity both to maintain social acceptance and to increase their chances of acting correctly in uncertain situations.
• The stronger these individual motivations are, the stronger the group’s attraction and cohesion, and the greater the pressure exerted by the group on the individual.
• Because this pressure depends on how the individual reacts to the group, it is impossible for the individual to easily resist it.

If Hitler told you to shock a stranger, would you comply?

Milgram’s shock experiment tells us that human nature is willing to do evil under command, even exceeding the command given above. This can also explain the behavior of sycophants, as releasing human evil simultaneously allows them to show loyalty and gain merit.

Shaping is a learning procedure. In this learning procedure, initially, rewards are given for any behavior similar to the target behavior; then, the standard is gradually raised, and rewards are given only for behaviors that are increasingly similar to the target behavior; finally, rewards are given only when the target behavior actually occurs. Some teachers apply this instrumental behavior shaping method in daily teaching. For example, when training students to think about problems, initially, regardless of what answer the student gives, the teacher gives verbal praise for the behavior of raising their hand bravely; then, rewards are selectively given for increasingly better answers.

People like to repeat behaviors that bring benefits to themselves, and instrumental learning is the direct result of applying this principle. In instrumental learning, behavior becomes the “tool” for obtaining benefits, and “these benefits” are a form of positive reinforcement; here, reinforcement is defined as a stimulus that can increase the frequency of behavior occurrence. Through instrumental learning, we learn to continue implementing behaviors that bring rewards, and terminate behaviors that cannot be rewarded or bring trouble. Indeed, these simple principles have been widely and effectively applied in daily life.

Dogs Can Also Train the Owner

Researchers selected 7 students aged 12–15 from a class considered “hopeless” (or “unredeemable”), and trained them to practice behavior modification. The researchers taught the students many reinforcement methods that could be used to shape their own teacher’s behavior. These reinforcement methods include smiling, making eye contact, and maintaining a straight posture in their seats. The students also practiced ways to praise their teacher, for example, by telling the teacher, “I like learning in a class where the teacher is very good to the students.” Similarly, they also learned to impede some of the teacher’s negative behaviors through language, for example, the students would say, “It is hard for me to study well when you are angry with me” (Gray et al., 1974, p.44). Although these techniques were very difficult to learn, the students eventually mastered them, and these children finally possessed their own treasure trove of rewards, thereby no longer being controlled by the teacher.

Even if your genes are good and your physical foundation is strong, long-term consumption of junk food and aggressively engineered foods will eventually make you sick. Even those with high IQs will become intellectually weak if they constantly consume media input, propaganda, and the ideas others have chewed over.

The audience’s capacity for reception is extremely limited; they grasp very little. Furthermore, they are highly forgetful. Given this, effective propaganda must be concentrated on only a few key points and must definitely be presented in the form of slogans, until every individual understands the meaning of that slogan. To sacrifice this principle in pursuit of comprehensiveness is to inevitably doom the effective propaganda effort, as people cannot digest or retain what is presented to them.

Grand Spectacle

The uniforms, banners, flags, and symbols designed by Hitler and Goebbels all belong to the Nazi German propaganda machine; they use these powerful visual elements to amplify the impact of powerful language. Meetings are far more than just occasions where people gather to speak; they are meticulously orchestrated to achieve a dramatic effect. The carefully designed scenery, lighting, background music, and the timing of entrances and exits push the emotions of the already cheering and highly enthusiastic audience to a climax.

Their Methods

1. Cult of Personality: Shaping Absolute Authority

This is the foundation of all authoritarian rule. Through various propaganda means, the leader is molded into an image of omnipotence, brilliance, and martial prowess, often even endowed with supernatural abilities, making them a “god” in the eyes of the populace. This creation of personal worship aims to strip the people of their independent thinking ability, forcing them to blindly obey the leader’s will.

2. Information Monopoly: Controlling the Source of Thought

Information is the carrier of thought. By controlling channels of information dissemination—such as media, publishing, and the internet—and monopolizing the release and spread of information, only data aligned with the ruler’s wishes is allowed to circulate. This is used to shape public opinion and control the populace’s mindset.

3. Suppressing Freedom of Speech: Stifling the Voice of Dissent

Freedom of speech is the guarantee of intellectual freedom. By suppressing freedom of speech and banning any criticism or questioning of the ruler, dissent is stifled through intimidation, censorship, and even violence, creating a situation where all voices are muted.

4. Promising Utopia: Painting an Illusory Future

By depicting a beautiful future—such as a “Communist Paradise” or a “Millennial Empire”—rulers stimulate the hope and enthusiasm of the people, thereby masking the cruelty of reality and the true nature of the regime. This false promise often becomes a crucial tool for the rulers to deceive the masses.

5. Creating Enemies and Inciting Hatred: Shifting the Focus of Conflict

By artificially establishing one or more “enemies”—such as “foreign hostile forces,” “counter-revolutionaries,” or “heretics”—the social conflict is shifted onto these “enemies.” Hatred is then incited among the people toward these enemies, thereby consolidating internal strength and maintaining the rule.

6. Controlling Education and Cultural Propaganda: Conducting Systematic Brainwashing

By controlling the education system, single-minded ideological indoctrination is carried out from a young age, ensuring the people accept predetermined values and ideologies. Simultaneously, various propaganda tools are utilized to conduct massive positive publicity, shaping the glorious image of the leader and disseminating favorable narratives for the regime.

7. Benevolence and Coercion (Carrot and Stick): The Dual Method of Rule

For the compliant, rewards and favors are given; for the resistors, severe punishment and suppression are employed. This “carrot and stick” strategy effectively controls people’s behavior, making them hesitant to challenge the ruler’s authority easily.

8. Exploiting Crises or Periods of Turmoil: Seizing the Opportunity

When society faces a crisis or period of instability, the populace often feels anxious and lost. At this time, cults, Nazis, and dictators are more likely to exploit this psychological state by offering seemingly effective solutions or promises, thereby gaining support and power.

9. Establishing Strict Organization and Hierarchy: Ensuring Power Concentration

By establishing a strict organizational structure and hierarchy, power is concentrated in the hands of the leader, and it is ensured that orders are effectively transmitted and executed. This pyramidal power structure allows the leader to exert effective control over the entire organization.

10. Emphasizing Collectivism and Suppressing Individualism: Erasing Individual Independence

By emphasizing that the collective interest is paramount, the individual must submit to the group. This ideology effectively suppresses individual consciousness and independent thought, making the individual a tool of the collective, thereby serving the ruler better.

11. Divide and Rule

By encouraging internal strife, tribalism, or mistrust, the potential opposition groups are encouraged to fracture, ensuring that a unified resistance cannot form.

These tactics do not exist in isolation; rather, they are interconnected and mutually reinforcing, collectively forming a tight control system. Recognizing and being vigilant against these tactics helps us maintain a clear mind, preventing us from being deceived and exploited, and jointly safeguarding the values of freedom and democracy. Only through continuous reflection and vigilance can we maximize the prevention of historical tragedies repeating themselves.

Countermeasures

1. Cultivating Critical Thinking: Not Blindly Following, But Thinking Deeply

• Questioning Authority: Do not easily accept any unverified information, especially propaganda from official channels. Cultivate the habit of independent thinking, maintaining a degree of skepticism toward all information, and refusing to blindly trust authority.
• Thinking from Multiple Angles: Try to view issues from different perspectives and seek various sources of information. Do not accept a single explanation; instead, try to understand as many different viewpoints and positions as possible to form a comprehensive understanding.
• Logical Reasoning: Learning basic knowledge of logic, such as identifying common logical fallacies, helps in discerning the loopholes in false information and propaganda slogans.

2. Expanding Information Sources: Breaking the Information Cocoon

• Using Circumvention Tools (If Possible): Although risky, using tools like VPNs allows access to censored foreign information, providing a more comprehensive view and breaking the information blockade. Be sure to prioritize security, choosing reputable VPN services and protecting personal privacy.
• Following Independent Media and Commentators: Look for independent media outlets and commentators who often provide perspectives and views different from the official propaganda. However, be mindful of verifying the truthfulness of the information and maintaining critical thinking.
• Interacting with People from Different Backgrounds: Communicating with people from diverse backgrounds and viewpoints helps broaden your horizons, understand different perspectives, and avoid falling into a single mode of thinking.

3. Protecting Personal Privacy: Speaking Cautiously, Paying Attention to Cybersecurity

• Avoiding Sensitive Remarks in Public: In high-pressure environments, one must speak carefully and cautiously, avoiding making any remarks that might cause trouble in public, including on social media.
• Using Secure Communication Tools: Use encrypted communication software for private exchanges to prevent personal information from being monitored.
• Paying Attention to Cybersecurity: Regularly change passwords, avoid clicking on unknown links, and prevent personal information leakage.

4. Studying History: Learning from the Past to Avoid Repeating Mistakes

• Understanding the History of Totalitarianism: By reading historical books and watching documentaries, one can understand the operation and dangers of totalitarianism, thereby increasing vigilance and avoiding past mistakes.
• Focusing on Human Rights and Freedom: Paying attention to the international community’s focus on human rights and freedom, and understanding related laws and systems, helps in better protecting one’s own rights.

5. Maintaining Physical and Mental Health: Preserving Mental Independence

• Maintaining an Optimistic Mindset: In high-pressure environments, maintaining an optimistic mindset is crucial. Stress can be relieved through exercise, meditation, and other methods, helping to maintain physical and mental health.
• Seeking Support: If feeling excessive pressure, seek help and support from friends, family, or professionals.

6. Accumulating Strength, Waiting for the Right Moment: Never Giving Up Hope

• Don’t Despair: Even in the darkest times, maintain hope, believing that change will eventually come.
• Accumulating Strength: Within one’s personal capacity, do things that can be done, such as spreading the truth or supporting vulnerable groups.
• Monitoring Social Changes: Closely monitor social changes, waiting for the appropriate moment.

Important Tips:

• Safety is always the priority. Before taking any action, be sure to carefully assess the risks and take necessary safety measures.
• Do not try to fight the powerful totalitarian machine alone. Protecting yourself, accumulating strength, and waiting for the right moment is the wiser choice.
• These suggestions are designed to help individuals maintain independent thinking, protect themselves, and build strength for future change in high-pressure environments. Remember, even in the darkest moments, maintain hope, believing that light will eventually come.

The Simplest Way: Escape

The core reason why the vast majority of people fail is not because they don’t engage in production, nor is it because they never accumulate, but rather because they fail to accumulate for a sufficient period of time. Consequently, the amount of money is insufficient, and thus, they fail to acquire or master true wealth.

Life should be centered around production. Everything else, no matter what it is, must be ranked after it. Nothing is more important than production—at least, until basic necessities are met.

What Exactly Are the Means of Production?

• Time is the only means of production owned by the proletariat. Time is incompressible, time is uncrossable, and time is always indispensable.
• You must produce goods and services that can be sold. This means someone needs them, or even the entire society needs them, for someone to buy them. Otherwise, how good you feel your creation is is useless. If no one wants it, there is no exchange, and therefore, there is no money.

The Fundamental Reason for Life’s Hardship

To make money, you must produce, because the only legitimate source of wealth is production; conversely, if you don’t produce, you won’t earn money. Fundamentally speaking, the difference in people’s income primarily stems from their proximity to effective production. In other words, the closer you are to production, the more money you earn; or conversely, the farther you are from production, the less money you earn.

The Jobs People Dislike

In the past, apprentices mostly focused on the manufacturing process; but for today’s working professionals, the most profitable approach might be to choose the sales process—that is, working in the sales department.

The key here is that sales income has no upper limit. This is something that no other organized form of effective production can rival. The more developed society becomes, the larger the market gets, and the richer the variety of goods and services, the more essential sales become to the producers. Therefore, many sales positions have a “performance commission incentive mechanism”—how much you earn depends on your performance. Other positions, such as administration, accounting, and logistics, generally have fixed salaries. So, if you want to earn more, you should prioritize choosing sales.

Absurdly Selling the Means of Production

Time is our ultimate means of production. The tragic thing is that 99% of people rely on directly selling their time to earn income. For the vast majority of people, their personal business model throughout their lives is simply selling their time without any processing. Then, they desperately compete at this level, striving to have the highest unit price for their time—that’s all.

The Business Acumen Not Taught in School

Customer Lifetime Value refers to the profit you can earn from a single customer who purchases your goods or services throughout their entire life.

• The shorter the time cost, the harder it is to make money in a business.

For a restaurant, it is actually a quite good business for the average person, and the probability of success is quite high. However, from the perspective of time cost, this business is not the most profitable. It has a certain learning time cost, and while the daily production time cost is not high, it requires continuous production, and every sale incurs a certain time cost.

In comparison,

Creating a book is relatively much more profitable because, although the learning time cost is relatively high (research and preparation), there is also some production time cost (the writing process). But the sales time cost and the reproduction time cost are zero for the author.

Money is a Social Ledger

• From the essential nature of a social ledger, it can be seen that money is actually the debt of the entire society. It represents what the society owes you or the services it owes you. If you are very poor and lack money, it actually represents that you owe society a lot. You have made little contribution to society.

• Since money can store anything, money can naturally also be a form of means of production.

• Money is the means of production. Furthermore, it is also the most flexible form of storage.

• Money is the most flexible means of production.

Money Has Two Different Uses

• For most people, money has only one use: consumption.
• The second, and far more important, use of money is: investment.

The desire for investment grows from nothing and becomes increasingly strong. It automatically overwhelms the desire for consumption, to the point where, without realizing it, you naturally use more money for investment rather than consumption, unless it is a necessity.

Consumption is certainly joyful because desires are satisfied. But in reality, investment is also joyful; it is also a way of satisfying desires, and perhaps even more joyful.

Knowledge is like this, and useful knowledge is even more so. Once you learn it, you cannot forget it. Right now, it is difficult for you to waste money carelessly because you feel it should be used to produce something; it is difficult for you to hate the rich because you know the wealthy are creditors; it is difficult for you to ignore financial management because you know money is the storage of all things, and your freedom is stored there; it is difficult for you to be content with simply selling your time because you know that is the worst personal business model.

The Fundamental Principle of Producing with Money

The essence of investment is actually lending and receiving interest. Even the core of finance is merely interest; and the entire financial market is driven by and exists solely because of the rate of return.

• Money is actually a form of means of production.
• Interest is compensation for the opportunity cost of capital.

Just like time, capital is a scarce resource. This means that its use incurs an opportunity cost.

Regarding Borrowing Money

All money lent to relatives and friends is essentially given away; do not expect them to pay it back.

Those who know how to produce with money cannot just lend money out casually because their opportunity cost is relatively higher. If you think deeply, many people lend money to others not because they consider themselves generous or benevolent, but because of ignorance or incompetence. The opportunity cost of the money they hold is actually zero, so they don’t care much. Of course, this statement is harsh, but the logic is sound.

Equity is Essentially Equivalent to Debt

• From the company’s perspective, the company has borrowed money that never needs to be repaid.
• From the lender’s perspective, there are suddenly many benefits: higher returns and stronger liquidity.

The Fundamental Difference Between Investment and Speculation

In the stock market, all investors are traders, but not all traders are investors. Only a tiny minority of traders follow a long-term holding strategy, while the vast majority of traders engage in frequent trading. What is the difference? Only investors consider time to be a necessary component of the means of production, whereas the vast majority of traders—let’s call them “speculators”—do not have time in their means of production.

Time is the Only Path to Development.

Traders play completely different games in the same arena. Speculators participate in what I consider to be the worst kind of limited game, called a “zero-sum game”: the money earned is precisely the money lost by others. But investors are different; if they succeed, they earn the “result of development.” What they participate in is actually an “infinite game.”

The Mirror Effect of Investment Risk

I am too lazy to even look at financial reports because the best companies are the ones that are least profitable when they falsify their reports. I have a background in accounting, so it’s not that I can’t understand financial reports; I just feel that picking stocks by looking at reports is like trying to find gold in a pile of garbage. But the problem is, the gold mountain is standing right there, so why bother? The way ordinary people choose stocks is simple: first, try to choose the best goods in life. Then, not only buy the goods, but also buy the stock simultaneously.

The Actual Shape of Individual Time

Time is like a container, and inside it are all the people who have lived up to the present, and all the things they have done. Obviously, the size of each person’s time container is different.

Time, this container, has a start and an end, but between the start and the end, time is more like a pipeline than just a straight line. Some people do more things in a unit of time and are more efficient; therefore, this person’s time is different from others’ time—it has a larger diameter, a thicker pipeline. Some people do nothing meaningful for a long period of time; then, this person’s time during that period is merely a straight line.

What should we do to earn money? Produce, sell, invest. In any case, we absolutely cannot waste this ultimate means of production, time, on things that yield no output.

How to Do More Things

• After spending time to earn money, we must do more things.
• More precious than financial freedom is actually time freedom.

For those without production capacity, time is merely a ray—instantaneously having no area, long-term having no volume; time is not even a means of production. Therefore, time can only be “bored,” bored to the point of “waste,” and must reach the point of being “killed.” For those with production capacity, time is simply too beautiful; it can be used to create anything, do countless things, and even nurture kinship or love. Furthermore, as production efficiency increases, the possibilities of time become more numerous and greater. This is probably the most exciting reason why we are obsessed with learning and unwilling to spare any skill!

Factors Acting Against Production

If you are a producer, or even an effective producer, or even just someone aspiring to be a producer, you must know that there are things that are naturally “anti-production” and must absolutely be avoided. First are drugs and gambling. The ultimate victims of these two things are likely to start innocently, based on the naive idea of “just trying” or “just playing,” holding the hope that “it won’t happen again.” Little do they know, these two things should not even be touched.

Of course, more common than drugs and gambling is vanity. The definition of vanity can be very clear: money used for consumption was not earned through one’s own production, yet one is not ashamed of it but is proud of it.

Affluence Index = Own Production Income / Own Consumption Expenditure

• If a person’s Affluence Index = 1, they are neither poor nor rich;
• If the Affluence Index < 1, they are poor, and the smaller the index, the poorer they are;
• If the Affluence Index > 1, they are affluent, and the larger the index, the richer they are.

Many so-called wealthy people actually face the dilemma that their consumption expenditure is very high, while their production income is equal to 0, or even less than 0.

Some people genuinely earn money through effective production, yet they often fall back into poverty—as the old saying goes, “Seeing the high building, seeing the banquet, seeing the building collapse.” The core reason for falling back into poverty is always the same: the growth rate of consumption expenditure far exceeds the growth rate of production income.

To put it in my own words, never increase your consumption level too quickly.

In the more than 40 years since the Reform and Opening Up, a large number of so-called “middle class” people have appeared. But once the economy declines, the vast majority of them fall back into poverty overnight. What happened? It wasn’t that they didn’t earn money; their problem was that they earned money but couldn’t control their spending. Too many expenditures in life are not necessities but stem from desires from various angles. Desire has no end; if it is not properly controlled, it actually has the power to make anyone fall back into poverty, no matter how strong their production capacity is.

Wealth Gap is Inevitable

Every carriage requires at least 4 people to carry it; there must inevitably be poor people, and society needs poor people to function normally.

Basic Principles for Improving Efficiency

The act of learning actually includes at least four levels: learning, practicing, applying, and creating. Therefore, just learning without applying is a waste of time and is the fundamental reason why most people fail to learn. What you learn must be used; what you learn must be practiced. The process of practice is actually the only way to improve efficiency. Through massive iteration (not just repetition), continuous accumulation, and continuous improvement. Efficiency can never happen overnight, because efficiency is something that must be developed.

Unexpected things will happen in life, and you will encounter bad people and bad events, but these are all external factors. Their existence or appearance has already damaged my development; you must absolutely not let them further devour my ultimate means of production. After all, all my wealth, whether material or spiritual, comes from my time, or more accurately, from the volume of my time. What time do I have to waste? What reason do I have to waste it on them? At all times, focusing on improving efficiency is the main task.

Summary

• Wealth comes from production, and it comes from oneself;
• Time is the ultimate means of production;
• Money is the storage of all things;
• Money is the most flexible means of production.

In this increasingly better era, as long as you spend your time on self-study, production, sales, and investment, you can earn money, and there are still many things worth doing.

The US Constitution and Free Society are the Strongest Guarantees

I firmly believe that the US Constitution and the free society structure are among the most valuable assets in the world. The rule of law and the powerful military, particularly the aircraft carrier, provide a unique guarantee for global investors. If the US Constitution protects investors’ rights and the economy relies on the free market, it will provide a solid foundation for my chosen assets.

Globally, while other countries have excellent companies, they are not protected by a constitution and military power like the US. The US Constitution makes it a special economy, and this guarantee allows American companies to occupy an important position globally. Therefore, I think choosing the S&P 500 is not just choosing a basket of top global companies, but also choosing a system protected by the US Constitution and military power.

S&P 500 Represents the Strongest Global Companies

The S&P 500 is not a single “stock” asset; it is a collective symbol of the 500 strongest companies in the world. These companies are leaders in multiple industries and have global competitiveness. Their strength is not only reflected in their market share and financial performance but also in the stable, law-based, free market, and powerful military behind them.

I believe that the 500 companies represented by the S&P 500 not only occupy a leading position in finance and technology globally but also enjoy the protection of the US Constitution and powerful military. This is why I think the S&P 500 has a unique advantage that no other asset can match.

Market Fluctuations and Long-term Beliefs

Although the S&P 500 has experienced several market crashes, such as the 2008 financial crisis and the 2020 COVID-19 pandemic, I believe these are just short-term fluctuations. In the long term, the fundamentals of the S&P 500 have not changed; it still represents the strong economic power and corporate competitiveness of the US. Therefore, during market crashes, my decision is not to sell the S&P 500 but to hold it firmly. Even if the market experiences temporary crashes, I do not think any other asset can replace the S&P 500 as a long-term value storage tool.

Many investors choose to sell assets and exchange them for cash during market crashes, but I think the value of cash is far less than the S&P 500. In my view, the S&P 500 is the most valuable asset globally, while cash depreciates over time due to inflation. Therefore, unless it’s for necessary living expenses, I choose to focus my wealth on the S&P 500 and not sell it easily.

Diversification and Risk Management

Although I have unwavering trust in the S&P 500, I still maintain a certain level of diversification. In my asset allocation, I invest 90% of my wealth in the S&P 500 and the remaining 10% in the PIMCO Enhanced Short Maturity Active ETF (MINT), which has high liquidity. This configuration not only maintains the growth potential of most of my assets but also provides additional liquidity and risk cushion during market fluctuations.

I chose MINT because it represents low risk and stable returns. This part of my assets can help me maintain a certain level of cash flow during market turbulence, allowing me to respond to unforeseen emergencies or adjustments.

Why Not Diversify into Other Markets or Assets?

Many investment experts recommend diversifying investments to reduce risk, such as investing in international markets, gold, or real estate. However, I firmly believe that no country or market can be stronger than the US. The US Constitution and free society are the foundation of my trust, and the US military power and aircraft carriers fleet provide a unique safety guarantee for global investors. In this context, I think the S&P 500 not only represents the top 500 companies in the world but also the strongest economy and military system globally.

Although I understand the importance of diversification, due to my firm trust in the US free society and Constitution, I believe the S&P 500 is the most valuable and worthy long-term holding asset globally. Therefore, I do not tend to diversify my assets into other markets or assets like gold, as they do not have the same guarantees and potential as the S&P 500.

How to Face Uncertainty and Challenges?

Although I have deep trust in the S&P 500, I am not complacent about the changes in the global economic situation and political landscape. Although I do not have in-depth knowledge of global geopolitics and international trade conflicts, I remain rational and calm. I cannot predict every market fluctuation, I can rely on long-term investment strategies to cope with these uncertainties.

For me, the core of long-term investment is patience, trust, and determination. Even if the global economy undergoes drastic changes, I will rely on my trust in the S&P 500 and the US system, continue to hold it, and not make emotional decisions due to short-term fluctuations.

Conclusion: Rational Investment, Firm Beliefs

Through this period of thinking and investment decision-making, I have established my own investment philosophy: the S&P 500 is not just a stock market index, but a representation of my trust in the US Constitution, free society, and powerful military. I choose to invest most of my wealth in the S&P 500 and maintain a long-term holding strategy because it represents the top companies and the most stable economy globally.

Although I know that global economic and political risks are unavoidable, I believe the S&P 500 is the most worthy long-term holding asset. If the market crashes in the future, I will firmly believe in my decision and not sell easily, but instead, choose to wait patiently for the market to recover.

Epilogue

Through in-depth analysis of the logic behind the S&P 500, I am confident in my investment decisions. Long-term market fluctuations cannot shake my trust in the US Constitution and free society, which has given me a more firm belief in my investment path. In my future investment journey, I will continue to adhere to this philosophy, maintain sensitivity to market changes, and continuously increase my knowledge to better cope with potential risks.

As a participant in the trading market, it is unlikely that you will sell at the absolute peak, and it is also difficult for you to buy at the absolute bottom…

Why? The reason is very clear and very simple:

People are Impulsive and Emotional

The highest point and the lowest point are both caused by the “impulsiveness” of a small portion of traders…

You are destined to be a disciplined person, so, that portion of impulsive trading is destined not to belong to the disciplined you! Believe me, you are a normal person, so it is perfectly normal for occasional hallucinations to appear. However, you are different. How are you different? The difference is that when the hallucination appears, you can recognize it, you clearly know that it is an illusion, which means you can, just like a normal person, shake your head vigorously, shake off that illusion, and continue living and thinking normally…

Short-term, it acts like a voting machine; long-term, it acts like a weighing machine.

The Higher the Trading Frequency, the Closer the Trade is to a Zero-Sum Game

The result of frequent trading is the accumulation of transaction fees, which eventually devours all your profits and principal.

The shorter the prediction, the closer it is to a coin flip;

the longer the prediction, the closer it is to true logical deduction…

Therefore, the essence of reducing trading frequency is rejecting the coin flip and adhering to logical deduction.

Risk-Reward Ratio

The Risk-Reward Ratio (or Return-Risk Ratio) is a crucial concept in investing and trading, used to measure the expected return for every unit of risk undertaken. It reflects the relationship between the risk and the potential return of a trading opportunity or investment decision.

Risk-Reward Ratio = Potential Return ÷ Risk Taken

Potential Return: Refers to the target profit, which is the amount you hope to gain from the trade. For example, if you buy a stock and expect it to rise to a certain price, you calculate the difference between that price and the purchase price.

Risk Taken (or Assumed Risk): Refers to the maximum possible loss you are willing to bear, usually determined by the stop-loss price. For example, after buying a stock, you set a stop-loss price and calculate the difference between the stop-loss price and the purchase price.

• Challenges when Trading Frequency is High: Frequent trading causes the “Risk-Reward Ratio” of each trade to become lower. This is because the probability of achieving a massive return in a short period is very low. Even if the market occasionally experiences violent fluctuations (sharp rise or sharp fall), attempting to capture this volatility carries extremely high risk—like “picking chestnuts out of the fire”—making losses likely.

• The Concept of Risk-Reward Ratio: The Risk-Reward Ratio refers to the potential return generated per unit of risk. If trading frequently, the potential return of each trade is often insufficient, while the risk always exists, making it difficult to improve the ratio.

The Significance of Proactively Reducing Trading Frequency

Proactive vs. Passive:

Proactively reducing trading frequency is an action where the trader controls the pace themselves, indicating that the trader is managing the market rhythm rather than being dragged along by short-term market fluctuations. Conversely, “unconsciously frequent trading” is a passive reaction driven by market sentiment, usually manifesting as the trader fearing missing out on opportunities (FOMO) or rushing to chase short-term volatility.

How to Improve the Risk-Reward Ratio:

Proactively reducing trading frequency actually improves the Risk-Reward Ratio indirectly:

• Risk (Denominator) remains unchanged: The risk you bear has not increased.
• Return (Numerator) increases: By reducing frequency, you focus on opportunities with greater potential, increasing the expectation of potential returns.

There are many frustrating laws in the trading market, such as:

• Whenever you need money, the market crashes!
• It might not seem logically supported, so you might temporarily doubt it, but you will definitely experience the power of this law.
• For all beginners, this law is almost eternally true:
• As soon as you buy, it starts falling;
• As soon as you sell, it starts rising…

Why does this paradoxical situation occur? Because the fundamental reason for the end of every market cycle is capital exhaustion at entry. In other words, when even the auntie selling tea eggs on the street starts discussing stocks, the market’s “entry capital” is already on the verge of running out… Think about it: even someone completely unrelated to the topic knows this. When it’s time to rush in and make money, doesn’t that mean the market cycle is over?

Mending the Pen After the Sheep is Lost Has Prerequisites

• You don’t just have the one sheep that was lost;
• Besides it, you should have many other sheep;
• Because you have many sheep, you must have built a “sheep pen” in the past;
• Therefore, even though you have “lost a sheep,” you still have a chance to “mend the pen”;
• Therefore, once the “pen” is mended, you can manage more sheep;
• Therefore, the loss of one or two sheep initially is negligible to the final outcome.
• So, what should the “leek” (retail investor) who has “lost a sheep” do? It’s simple:
• If you have money, slowly add to your position (buy more);
• If you don’t have enough money, desperately make money outside the market.

Controlling Position Size

You must always reserve a certain proportion or at least a certain amount of cash—this is non-negotiable, just like a diver needs an oxygen tank. As for what that proportion or amount should be, there is no fixed theorem; it is entirely up to your own judgment.

This viewpoint primarily emphasizes the necessity of controlling position size and holding cash. Here is the reasoning and logical analysis:

1. Cash Flexibility: Coping with Unknown Risks

In the investment market, risk is unavoidable, and market fluctuations can happen at any time. If you invest all your funds without keeping cash reserves, you may find yourself in a passive position when the market experiences a sharp decline or an emergency situation:

• Preventing Forced Selling: If the market suddenly drops, holding cash allows you to avoid being forced to sell assets at a low point.
• Handling Emergencies: Cash is the most liquid asset and can be used at any time to deal with sudden needs, whether it’s an urgent living expense or an investment opportunity.

2. Cash is the “Oxygen Tank”: Avoiding Full-Position Risk

• Comparing cash to an “oxygen tank” highlights its lifeline significance, especially during extreme market volatility:
• Buffering Effect: The market environment can be like a deep sea dive full of pressure; cash reserves provide you with breathing room during a crisis.
• Psychological Comfort: Holding a certain amount of cash gives you greater security during market fluctuations, reducing the possibility of making incorrect decisions out of panic.

3. Seizing Opportunities: “Ammunition” During Market Downturns

The market is cyclical, and opportunities for undervaluation always arise. If all your funds are invested without keeping cash, you might not be able to take advantage of opportunities when they appear:

• Buying on Dips: During market downturns, those with cash can buy quality assets at lower prices.
• Asset Appreciation Potential: This “ammunition” can help you achieve higher returns when the market recovers.

Excellent, Successful Traders Are Ultimately Risk Averse

• Watch other people taking risks! Sometimes the “correct conclusion” looks so sinister, even if it shines brightly in the deepest parts.

Extreme Fear of Missing Out

Fear of Missing Out, abbreviated as FOMO, is also known as Fear of Missing Opportunity.

FOMO, “Extreme Fear of Missing Opportunity.” FOMO is almost the most widespread phenomenon, and the more fundamental it is, the easier it is to be swayed by it. Just look at the slogans used by pyramid schemes or micro-businesses, and you’ll see they are almost always the same:

You missed XXX, and then you missed YYY, and now you want to miss ZZZ?!

The more lacking in opportunities a person is, the easier it is for them to be incited by such phrasing. Calm down and think about it: if you are not a person lacking opportunities, even if the price of Bitcoin skyrockets, will you feel anxious because of that fact? No! Because you have other opportunities.

Solitude is the Most Precious Quality of a Successful Trader

If you are not good at entertaining yourself, if you do not spend a large amount of time living life seriously, then you cannot reduce your trading frequency, and you will become like a leek staring at the screen all day, keeping your phone within reach even while having sex with your girlfriend—failure is inevitable.

Experts do not prioritize “correctness,” because anyone can be correct; it is not that difficult. The truly difficult thing is that you are not only correct, but you are uniquely correct. Only by being “unique and correct” can you generate massive trading value.

Consensus May Create Price (Though Not Necessarily Value)

Extreme Fear of Missing Out

Fear of Missing Out, abbreviated as FOMO, is also referred to as Fear of Missing Opportunity.

FOMO, “Extreme Fear of Missing Opportunity.” FOMO is almost the most widespread phenomenon, and the deeper the layer, the easier it is for people to be swayed by it. Just look at the slogans used by pyramid schemes or micro-businesses, and you’ll see they are almost always the same:

You already missed XXX, and then you missed YYY, and now you want to miss ZZZ?!

People who lack opportunities are the easiest to be incited by such phrasing. If you calm down and think about it, you’ll understand. If you are someone who is not lacking opportunities, even if the price of Bitcoin skyrockets, will you feel anxious because of that fact? No! Because you have other opportunities.

Many risks are unavoidable. What we should do is assess the risks and take them. Some risks are not worth taking, no matter how high the potential return is.

Risk Assessment

I. What is your ultimate goal? If achieved, what will the situation be like? II. How can you achieve the goal with little or no risk? In other words, what elements can guarantee you reach your target smoothly? III. Are the options mentioned above feasible or desirable? If not, how much risk do you need to take to get what you want?

Risk Aversion (or Risk Mitigation)

A strategy that minimizes risk is risk aversion (or risk mitigation). Risk aversion protects you from losses through balancing measures, seeking equilibrium between risk and safety, much like a woman in a brothel. Alternatively, risk aversion might mean placing two bets simultaneously, where in a single-win scenario, you ultimately sacrifice some potential profit to offset potential losses. Another way to reduce risk is through insurance, paying others to bear the downside risk. The difference from risk aversion is that after paying the premium, you retain the full expected profit. Risk management reduces the probability of the worst-case scenario, but it also brings a disadvantage. Any tool that reduces risk can also be used to increase risk: a safety net can catch you when you fall, but it can also become a trampoline that launches you higher. Risk aversion and insurance are the same. Not only that, but reducing risk can give you the confidence to take chances, ultimately aiming for small gains to achieve large ones, or taking greater risks.

Control Your Emotions, Become the Master of Risk

Use risk management strategies to reduce your reaction to losses and maintain a consistent attitude when taking risks. This way, you will definitely not suffer too many losses, and you can remain fully focused on achieving success.

or anything that contradicts their existing views and conclusions. Therefore, if certain things might be painful, the human brain will start to act, trying to deny reality. Psychologist Daniel Kahneman, a Nobel laureate, believes: “(People often don’t even want to invest) the minimum effort to genuinely figure out what they did wrong. This isn’t accidental; it’s because they simply don’t want to know.”

Everyone Avoids

We all invent stories for ourselves and avoid the facts. Even if you spend a lot of time studying behavioral economics, your skills might only improve slightly. You will always make mistakes. People often ignore or refuse to acknowledge the faults of those they love, and tend to distort the facts to accommodate them.

Some people are clearly criminals—it requires no analysis or deduction—yet their mother insists her son is innocent. This is simple psychological denial. Reality is too painful to bear, so we must distort it in order to cope. To some extent, we all do this; it is a common psychological misjudgment, but it leads to serious problems.

All these returns come from luck, because I haven’t encountered a test moment. The market has been smooth sailing, placing it in the top 5% of the last 100 years. Therefore, I don’t consider my investment skill to be very high. The real test will come in those bad years, in the moments when everyone is panicking.

Significant Increase in Reading

This year, I read a large amount of investment and finance-related books. I forgot many, but I also retained some. It’s just like the food I eat: some becomes a part of the body, and some goes straight into the toilet.

Speculation Has No Prospects

Speculation = Predicting market sentiment

Investing is a probabilistic activity, and decisions made in a very rational manner sometimes result in poor outcomes. Even when decision-makers formulate a perfect plan and implement it smoothly, unfavorable results can still occur. However, in the long run, focusing on following the correct process, rather than any specific intermediate result, is always wise.

Whenever you want to buy a stock, someone is selling… so, you are forced to frequently ask this question: “Why am I the correct side in this transaction?”

Humans tend to collectively make foolish decisions. In certain situations, gathering together like lemmings, this can explain many of the foolish thoughts and behaviors of smart people.

Margin of Safety

According to Charlie Munger’s theory, it is probably only during a major stock market crash that one can achieve sufficient margin of safety. This puts extreme pressure on a person’s patience, and it might not suit me.

By gradually buying at an average cost (dollar-cost averaging), you can also achieve a certain margin of safety, and after a period of compounding, you can attain sufficient margin of safety.

Personal Thought Process

Initial Feeling: Lack of Resonance

When I first started reading The Old Man and the Sea, I did not feel a strong emotional connection. Santiago’s resilience and indomitable spirit seem to differ greatly from my personal philosophy of life. Although he persevered for three days and nights and finally caught the giant fish, I felt perplexed by his stubborn behavior. In my opinion, Santiago’s adventure is full of irrationality; he disregards potential risks and the possibility of failure, ultimately leading to unnecessary losses.

Reflection from an Economic Perspective

As someone who values rational decision-making, my first reaction is that the old man’s behavior has significant flaws. In investment and wealth management, cutting losses, identifying risks, and timely strategy adjustment are key to success. Santiago’s actions undoubtedly contradict this philosophy; he clings too tightly to his “sunk cost” and fails to give up at the appropriate moment. Ultimately, even though he won the struggle, the cost he paid due to the sharks’ attack exceeded the benefits. This behavior reminds me of some “fighting until the bitter end” actions in life, especially when one refuses to correct a mistake, which can lead to even greater losses.

Conflict between Rational Decision-Making and the “Never Give Up” Spirit

The “never give up” spirit in The Old Man and the Sea forms a stark contrast with the rational decision-making philosophy that I advocate. In modern society, especially in the investment field, there is a greater emphasis on rationality and flexible response rather than sheer persistence and struggle. I believe that facing challenges, timely admitting mistakes, cutting losses, and adjusting strategies is a more rational and efficient approach. Santiago’s behavior in the book seems somewhat impractical and outdated.

Relationship between Classic Literature and Historical Context

The Old Man and the Sea was born during the Cold War era of the 1950s. Literature of that period often focused on individual will and the struggle for survival. At that time, many people admired the spirit of tenacious struggle, whereas modern society places more emphasis on rational thinking and effective decision-making. Santiago’s persistence reflects the emphasis on individual spirit and the meaning of struggle during the Cold War, a point that may no longer align with our modern lifestyle and values.

Critical Understanding: Collision of Classic and Personal Values

Difference between Personal Understanding and the Classic

My low evaluation of The Old Man and the Sea does not mean that I cannot understand its value; rather, it reflects a conflict between my values and the spirit of the book. I do not endorse Santiago’s decision-making style, believing that his stubborn risk-taking, which ultimately resulted in loss, is not worthy of praise. As a proponent of rational decision-making, I believe that timely loss mitigation and strategy adjustment are the wisest choices. My viewpoint does not mean I lack literary sophistication; rather, it is an independent interpretation of the classic from a modern societal perspective.

Reflection and Value of the Classic Work

Classic literature is not perfect; it often challenges our way of thinking and our attitude toward life. Through critical reading, we can not only understand the work itself but also recognize our own life philosophy and decision-making principles on a deeper level. For me, The Old Man and the Sea is not a simple judgment of “good” or “bad,” but a work that inspires reflection, prompting me to consider rational decision-making and life attitudes.

Conclusion: Independent Thought and Personal Reading Journey

Overall, although I haven’t felt an emotional resonance with The Old Man and the Sea and do not endorse its “never give up” spirit, I still believe it is a work worth contemplating. Through this critical reading of the book, my commitment to rational decision-making and timely loss mitigation has been further solidified. The significance of classic literature lies not in whether it caters to every reader’s philosophy, but in its ability to inspire deep reflection on life, decisions, and principles.

I do not believe that I have “misunderstood” Hemingway, or that my evaluation of the work is flawed. On the contrary, it is precisely this independent thought about the classic that has enriched my reading journey and given me a deeper understanding of my own philosophy of life and decision-making.

Selecting Reading Material

Read classic works in the fields of mathematics, science, and philosophy. Do not read bestsellers, and do not focus on the news. Avoid joining any so-called “book clubs,” and do not pursue social validation. Place truth above social validation.

Writing and Thinking

Writing a blog is also a way of thinking. It acts like a hook, capturing inspiration and guiding people toward deeper contemplation.

Reading as Diet

If reading is compared to eating, then being a picky eater and having leftovers is a good thing. Do not treat reading as a competition of knowledge. A better approach is to repeatedly read worthwhile books, deeply reflect upon them, and absorb their content. Consolidating what you have learned through public output—this is the Feynman Learning Method.

The Difference Between Working and Investing

Earning money by investing, rather than earning money by exchanging time, is the biggest difference between working and investing.

Average Investment Level: Seeking Relative Victory

In the field of investment, achieving absolute victory is not easy, but achieving relative victory is more realistic. Investors who achieve relative victory can become profitable, while those who achieve absolute victory may become masters. However, mastery is not achieved overnight, nor can everyone become a master. Therefore, for ordinary investors, becoming a relative victor should be the primary goal.

The Relationship Between Return on Investment and Time

“Investment” refers to putting personal money, time, or energy resources into something expected to yield profitable or satisfactory returns. The return demanded by an investor depends on how much investment risk they perceive. If an investment is extremely risky, investors usually expect a higher rate of return.

Time and Liquidity: Key Factors Affecting Returns

Risk factors include Time and Liquidity. The longer the time required for an investment, the higher its rate of return should be. The longer others occupy your capital, the greater the possibility of capital loss due to unforeseen accidents. As an investor, you hope this risk is compensated.

Furthermore, investors must consider the liquidity of the capital. Liquidity refers to the ease or difficulty of investing and withdrawing capital from an asset. When you urgently need money, can you quickly withdraw funds from the invested company? If so, the investment has high liquidity, or in other words, the asset is easily convertible to cash; conversely, it has low liquidity.

Applicability of Installment Payments

Due to the existence of uncertainties, installment payments may be a more suitable choice.

Xiao Chen is in love, but his income is meager, making it difficult to meet Zhenzhen’s material needs. It is his girlfriend’s 20th birthday, and he must give her a gift no matter what. He gathered some money, bought a gold ring, and wrote on the card:

“Dear Zhenzhen, Happy Birthday! And I wish you happiness for all the holidays from today until we get married!”

Stock Market Bottom Fishing: Caution in High-Risk Operations

An old friend was rushing to catch a boat, driving as fast as possible to the dock. When he arrived, he found the boat had already left the shore. He locked his car, immediately jumped onto the boat at a sprinting pace, completing the action in one go without any pause. His action startled everyone on the boat, and the captain wondered, “Sir… the boat hasn’t even docked yet…”

Bottom Fishing refers to the strategy of buying when the stock price has fallen to its lowest point, especially after a sharp decline in a short period, anticipating that the price will quickly rebound. Buying the cheapest stock is the opportunity that all investors aspire to, and it is the profitable model adhered to by value investors. However, there is no clear standard for what constitutes the “cheapest” or “bottom” price. Bottom fishing is often a description of buying at an already occurred low point, but it is difficult to judge what future point will be the true bottom. Furthermore, sometimes a stock price drops rapidly not because it is undervalued, but because the company’s fundamentals genuinely have problems. If you buy at this time, the stock price may not rebound quickly; instead, it may fall further due to unclear fundamentals.

Investment master Peter Lynch once said, “Don’t bottom fish.” This means that if an investor is certain that the company’s fundamentals are not seriously flawed, and the stock price has fallen below reasonable valuation levels, they can consider buying without trying to predict the bottom.

Moral Hazard: The Hidden Danger of Selfish Behavior

Moral Hazard is not synonymous with moral depravity; rather, it refers to actions taken by individuals engaged in economic activities that maximize their own utility while being detrimental to others. Alternatively, it can be said that when one party in a contract does not fully bear the consequences of the risk, they will take selfish actions to maximize their own utility. This concept was proposed by Western economists in the 1980s and belongs to the field of economic philosophy.

Moral Hazard manifests in various forms, the most common of which are the following two:

1. Deliberately Causing Insurance Accidents For example, deliberately causing cargo loss or personal injury to defraud the insurance company. This behavior is increasingly prevalent in our country, especially in life insurance, where cases have occurred of insuring a person and then killing the insured to claim the insurance money, posing a threat to social stability.

2. Deliberately Exaggerating the Degree of Loss When an insurance accident occurs, the insured person should immediately notify the insurer and take measures to mitigate the loss. However, some people, in order to claim more insurance money, do not do their best to mitigate the loss but deliberately exaggerate it. For example, after a ship strikes a reef, the shipowner bribes the captain to deliberately steer the ship toward the reef, causing severe grounding, which makes it easier to commit fraud.

Productivity Advantage in Competition

Whoever has higher productivity is the one who can win in competition. As the saying goes: “I can fight with a broom handle, the problem is the Northern guys don’t!”

Monetary Properties of BTC

Money is a specific commodity that serves as a general medium of exchange, possessing functions such as a means of circulation, a means of payment, and a means of store of value. It satisfies the needs of commodity production and exchange, as well as the need to hold wealth in monetary form.

Don’t Drink the Milk a Miser Offers You

There is no free lunch in the world. When faced with a sudden windfall, one must remain clear-headed and resist the temptation to take advantage, even in the face of huge economic benefits.

Supply and Demand are Mutually Causal

If there are no good men in the dance hall, will there be good women in the dance hall?

Say’s Law: Supply Creates Demand

Say’s Law, also known as the Market Law, states that under normal circumstances, a supply in the market will generate demand for it. Brodeur explains that any product supplied in the market drives the distribution of money during its production process—for instance, purchasing raw materials, paying transportation fees, and distributing wages. This distributed money will eventually reappear in the form of demand, thus forming a cycle between supply and demand.

Keynesianism: Demand Creates Supply

The British economist Keynes proposed a view diametrically opposed to Say’s Law in the 1930s: that demand can create its own supply. He believed that the free market cannot guarantee stable economic growth and full employment, and therefore, state intervention must be strengthened. When demand is insufficient, the government should take measures to stimulate demand, thereby driving economic growth and achieving the goals of full employment and increased supply. This view is known as the Keynesian Law.

Customer Value Gain: The Difference Between Total Value and Total Cost

Customer Value Gain refers to the difference between the customer’s total value and the customer’s total cost. The customer’s total value includes product value, service value, human capital value, and image value, etc.; the customer’s total cost covers monetary, time, energy, and mental costs. One way to increase the Customer Value Gain is to increase the total value purchased by the customer.

Consumption Imitation Effect: The Influence of Others

Our consumption expenditure is often influenced by those around us. For example, a young man might not wear the same clothes as his grandfather, but he will wear the same clothes, carry the same sling bag, and have the same hairstyle as his classmates or colleagues. This is the consumption imitation effect.

Snob Effect: The Charm of Scarcity and Expense

The Snob Effect refers to consumers preferring goods that only a few people can enjoy or that are unique. The fewer people who own a certain snobby good, the greater the demand for that good. Art masterpieces, specially designed sports cars, and custom-made clothing are typical snobby goods. The value consumers derive from them often stems from the privilege, status, and sense of honor that comes from the fact that “almost no one else owns the same thing as me.”

Poor Quality Assets: Worse than Having Nothing

Worse than having nothing is an asset that may bring losses at any time. Taking a car as an example, suppose someone gives you a BMW, and the other party pays the down payment; you only need to repay the mortgage monthly. However, you face not only the pressure of high repayments but also extra expenses such as fuel, maintenance, and upkeep. If you sell the car at this time, the price has often already fallen, and the proceeds are insufficient to repay the loan.

Currently, real estate is also trending toward becoming a poor quality asset. Negative assets mean not only having nothing but also owing a large debt to the bank. For example, if someone buys a house with a market price of 1.5 million RMB, and the current market price has fallen to 900,000 RMB, but the mortgage and interest they owe amount to 1 million RMB, their negative asset ratio is 10%.

Structural Unemployment: The Dilemma of Mismatched Supply and Demand

An older unmarried man encounters an older unmarried woman in the park and proposes a couplet: “Possessing a body of strength, but having no land to cultivate.” The woman immediately responds with the counter-couplet: “Wasting three feet of good land, yet no one comes to cultivate it.” This is a vivid depiction of structural unemployment: mismatched supply and demand leading to idle resources.

Even abandoning medicine for literature cannot save the Chinese people

The two most difficult things in this world are: first, putting other people’s money into your own pocket; second, implanting your own thoughts into others’ minds. The first thing affects people’s interests, while the second affects their soul.

At the end of the day, founding a star up primarily request you to do one thing: learning.

don’t look for tricks

the fact is there are no shortcuts in starting a start up . There’s no trick to get people to like you product. You just have to make a good product because that’s all your user care about.

The Four Methods of Deleveraging

1. Debt Restructuring: This refers to changing the terms of existing debt through negotiation, such as extending the repayment period, lowering the interest rate, or partially forgiving the principal, in order to alleviate the debtor’s burden. For a nation or a large corporation, this may involve complex legal and financial procedures.

2. Wealth Transfer: This usually refers to transferring wealth from the wealthy or specific industries to the government or the broader public through tax policies or other means, helping to repay public debt or support economic recovery. This practice may cause controversy among different social classes.

3. Spending Cuts (or Expenditure Reduction): The government or individuals reduce unnecessary expenditures, dedicating the saved funds to debt repayment. For the government, this may mean reducing investment in public services and social welfare; for individuals or families, it means cutting back on daily consumption.

4. Printing More Currency (Inflation): Although it sounds simple on the surface, this is actually about diluting the real value of debt by increasing the money supply. This method may lead to an increase in the inflation rate, subsequently affecting economic stability and purchasing power.

A Reflection

I actually took several months to truly realize that something so simple and familiar. Perhaps that is the significance of them inventing new terms. They take something you are very familiar with and turn it into something you don’t understand at all. If you understand something deeply, there is no room for maneuvering or manipulation.

This is a significant pitfall you might fall into when purchasing a car or a home.

Hugo is a very useful static site generator framework. Many people use it to write blogs and deploy them on GitHub Pages. However, this solution can only be used on a computer, meaning you have to open your computer every time you want to write an article. I strongly need a solution that allows me to record my thoughts at any moment—when my mind is racing, I can open my phone and immediately record it. Therefore, I need an APP that can be operated on a mobile phone.

Market Research

Before starting, I need to conduct a project evaluation survey to gauge user willingness to pay. Fake it till you make it.

Implementation Methods

1. Mobile operation with Git and OpenSSL directly on the local device.
2. Server Git clones the repository, uses Hugo for parsing, and provides API calls. This includes directories, categories, Tags, etc.

Making the Same Mistake Again

I didn’t do any market research and started developing the prototype immediately. Although the progress was fast, I know this is a form of laziness. Development is the easiest thing for me. This time, however, something is different: I have a real need, so at least I should use it myself first. If I don’t use the product, no one else will.

2024-10-26

• Finished editing and creating new articles.
• Optimized the slow article loading issue, mainly by drawing the controls first and then filling in the content.
• Currently, only submission and pushing to the server are missing.

2024-10-27

• Tried Android compilation, although only the Dart part was successful.
• Finished submitting to the server.
• Finally, the plugin interaction on the Linux platform was working.

2024-11-08

• I feel like I can release the first version; it’s barely decent.
• Later, I think I can add repository analysis header image loading.
• Next, I need to think about how to promote it.

2024-11-09

• Planned to only display .md files, but it seems ineffective.

• Considering displaying images.

• Finished the two issues above this morning.

• New bug: After analysis, the program must be restarted for it to take effect.

• Should place the “Add Tag” function below the existing tags.

• Completed the first version.

• Currently, only a landing page is missing.

• Next, I need to purchase a domain name to create a blog for the product itself.

2024-11-11

Today I discovered a huge pitfall: the keyboard covers the toolbar below the input field. At this point, it needs to be wrapped in a SingleChildScrollView at the outermost layer. This will automatically push the input field up when the keyboard pops up.

• The icons were lost.

2024-11-12

• Lots of details this evening; the devil is in the details.
• Tomorrow, I can make the preview font a bit larger; I think the current preview font is too small.
• The synchronization status also has issues; I need to check it tomorrow. Mainly, the progress bar isn’t displaying as expected during synchronization.

2024-11-12

• Finished multi-language support today.
• Considering making the URL theme smaller.
• Changing the loading state when syncing.

2024-11-13

If synchronization is in progress, clicking the repository should directly enter the settings synchronization page, instead of entering the directory browsing mode.

2024-11-22

• I think a “Recently Edited” function is needed. This way, I can open the most recently modified files as quickly as possible.
• I also need a full-text search, but I don’t know which technology stack would be best for it.

• They never thought about paying off the debt. The issued debt keeps increasing, and since they haven’t settled it year after year, it’s impossible to repay.
• Although they wish for infinite longevity, in reality, it’s merely a continuous reaction to stimuli.

1105

• Rushing to achieve results means you won’t be able to sustain it for long.
• The project is starting to take shape, and I think it looks pretty good. Tomorrow, we can draw the icons.

1109

• The first version completed today.
• We are still missing one landing page.
• Next, we need to purchase a domain name and create a blog for the product itself.

1110

• Completed folder management this morning.
• Fixed the issue where tags weren’t refreshing.
• Added the last modified time.
• We could consider setting the fetch ratio to be a little smaller.

1111

• It currently supports images.
• Uses left and right swipe gestures for file management.
• We don’t know how to manage the article covers because each theme is different.

1114

Refining details, taking screenshots, preparing the landing page.

1116

Everything has a cost; it’s just that some people see the cost and are willing to pay it. Some people fail to see the cost, or assume there will be none at all. When the time comes to pay that price, they will only complain about the unfairness of fate.

In such regimes, individuals face a prisoner's dilemma: although collective action could increase the likelihood of challenging the ruler successfully, the first to oppose often suffers severe consequences if others do not join. This creates a situation where everyone prefers to avoid the risk, maintaining a Nash equilibrium in which silence and compliance are rational choices. This mutual inaction leads to a stable yet coercive equilibrium where the authoritarian’s rule remains unchallenged.

However, during extreme conditions—such as famine, economic collapse, or war—this equilibrium may shift. When basic survival is under threat, the difference between acting and not acting diminishes, as both paths may offer similarly low chances of survival. At this point, rebellion equilibrium can emerge, where the collective desperation motivates more individuals to take action despite the risks.

Authoritarian leaders are therefore keenly aware of the need to prevent crises that push citizens into such a rebellion equilibrium. By maintaining a degree of economic stability and suppressing dissent through fear, they preserve their regime’s authority. Nonetheless, game theory illustrates that in the face of overwhelming hardship, even fear-based stability can break, exposing authoritarian rule to the risk of mass uprising.

独裁体制下 独裁者通过高压手段来防止反对派形成威胁，尤其对敢于公开反对的人进行严厉打击。这种严惩措施不仅能立即消除威胁，还能在群体中形成震慑效应，使得潜在的反对者不敢轻举妄动。
同时独裁者禁止人们参与社会组织，防止人们互助，我们可以用囚徒困境来理解它,类似于防止囚徒们合作。
只有当出现饥荒、经济崩溃、战乱等极端情况时，至少一定数量的人生命直接受到威胁，个人的机会成本和风险权衡发生剧变。此时，选择不反抗也意味着几乎没有生存的希望，因此反抗的代价和不反抗的代价趋于一致。

这也是为什么极权政权会极力避免经济崩溃或民生危机，因为这种危机不仅威胁到统治的稳定，也为反抗的发生创造了条件。

At that time, my analysis suggested that policy makers intended to temporarily stabilize the market by boosting large-cap stocks, and to enhance market confidence by releasing relevant news.

Currently, the stock price of Industrial and Commercial Bank of China (ICBC) has reached 6.14, but I don’t want to buy it because I feel ICBC is not worth that much money, so I am still planning to buy China Yangtze Power. The main logic is that the current interest rate spread is too low, which might affect dividends. Meanwhile, power demand has always been strong, and with the popularization of electric vehicles, the long-term outlook is even better.

If you’re not willing to react with equanimity to a market price decline of 50% two or three times a century, you’re not fit to be a common shareholder, and you deserve the mediocre result you’re going to get.

In other words, the market only offers two to three perfect buying opportunities per century, and you absolutely should not miss them.

Expected Annual Return = (1 + % needed to recover to peak) ^ (1 / Years to Recover) - 1

pow(1.5,1/5)-1

If the market has already fallen 33%, it needs to rise 50% to recover. If this recovery happens within one year, buying at -30% will yield a 50% return when it reaches the same level. Even if the market takes 5 years to recover, you can still achieve an 8% return.

In fact, during the 2008 financial crisis, it took the market 5 years to recover to its previous high. During the 2020 COVID-19 period, it only took 9 months for the market to recover to its peak.

Conclusion: The Just Keep Buying Rules

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Saving is for the Poor, Investing is for the Rich Find where you are in your financial journey before deciding where to focus your time and energy. If your expected savings are greater than your expected investment income, focus on savings; otherwise focus on investing. If they are similar, focus on both. (Ch. 1)

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Save What You Can Your income and spending are rarely fixed, so your savings rate shouldn’t be fixed either. Save what you can to reduce your financial stress. (Ch. 2)

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Focus on Income, Not Spending Cutting spending has its limits, but growing your income doesn’t. Find small ways to grow your income today that can turn into big ways to grow it tomorrow. (Ch. 3)

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Use The 2x Rule to Eliminate Spending Guilt If you ever feel guilty about splurging on yourself, invest the same amount of money into income-producing assets or donate to a good cause. This is the easiest way to have worry-free spending. (Ch. 4)

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Save at Least 50% of Your Future Raises and Bonuses A little lifestyle creep is okay, but keep it below 50% of your future raises if you want to stay on track. (Ch. 5)

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Debt Isn’t Good or Bad, It Depends on How You Use It Debt can be harmful in some scenarios and helpful in others. Use debt only when it can be most beneficial for your finances. (Ch. 6)

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Only Buy a Home When the Time Is Right Buying a home will probably be the biggest financial decision you ever make. As a result, you should only do it when it fits into both your finances and your current lifestyle. (Ch.

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When Saving for a Big Purchase, Use Cash Though bonds and stocks may earn you more while you wait, when saving for a wedding, home, or other big purchase, cash is the way to go. (Ch. 8)

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Retirement is About More Than Money Before you decide what to retire from, make sure you know what you want to retire to. (Ch. 9)

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Invest to Replace Your Waning Human Capital with Financial Capital You won’t be able to work forever, so replace your human capital with financial capital before it’s too late. Investing is the best way to accomplish this. (Ch. 10)

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Think Like an Owner and Buy Income-Producing Assets To really grow your income, think like an owner and use your money to buy income-producing assets. (Ch. 11)

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Don’t Buy Individual Stocks Buying individual stocks and expecting to outperform is like flipping a coin. You might succeed, but even if you do, how do you know it wasn’t just luck? (Ch. 12)

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Buy Quickly, Sell Slowly Since most markets are expected to rise over time, buying quickly and selling slowly is the optimal way to maximize your wealth. If you don’t feel comfortable with this, then what you are buying/ selling might be too risky for you. (Ch. 13, 18)

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Invest As Often As You Can If you think you can time the market by saving up cash, think again. Even God couldn’t beat dollar-cost averaging. (Ch. 14) Note - Page 283 · Location 4409 绝对不可能

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Investing Isn’t About the Cards You Are Dealt, but How You Play Your Hand You will experience periods of good and bad luck throughout your investing career. However, the most important thing is how you behave over the long term. (Ch. 15)

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Don’t Fear Volatility When It Inevitably Comes Markets won’t give you a free ride without some bumps along the way. Don’t forget that you have to experience some downside if you want to earn your upside. (Ch. 16)

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Market Crashes Are (Usually) Buying Opportunities Future returns are usually the highest following major crashes. Don’t be afraid to take advantage of these crashes when they periodically occur. (Ch. 17)

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Fund the Life You Need Before You Risk it for the Life You Want Though this book is called Just Keep Buying, sometimes it’s okay to sell. After all, what’s the point of building your wealth if you don’t do anything with it? (Ch. 18)

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Don’t Max Out Your 401( k) Without Considerable Thought The annual benefit of a 401( k) can be less than you think. Before you lock up your money for multiple decades, consider what else you might need it for instead. (Ch. 19)

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You’ll Never Feel Rich and That’s Okay No matter how successful you get with your money, there will always be someone with more. If you win the financial game, make sure you don’t lose yourself in the process. (Ch. 20)

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Time is Your Most Important Asset You can always earn more money, but nothing can buy you more time. (Ch. 21)

Introduction

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To build wealth it didn’t matter when you bought U.S. stocks, just that you bought them and kept buying them. It didn’t matter if valuations were high or low. It didn’t matter if you were in a bull market or a bear market. All that mattered was that you kept buying.

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When I say income-producing assets, I mean those assets that you expect to generate income for you far into the future, even if that income isn’t paid directly to you. This includes stocks, bonds, real estate, and much more. However, the specifics of the strategy are not critically important.

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It’s not about when to buy, how much to buy, or what to buy—just to keep buying.

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saving is for the poor and investing is for the rich

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First, figure out how much you expect to comfortably save in the next year.

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Next, determine how much you expect your investments to grow in the next year (in dollar terms).

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Finally, compare the two numbers. Which is higher, your expected savings or your expected investment growth?

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If your expected savings are higher, then you need to focus more on saving money and adding to your investments. However, if your expected investment growth is higher, then spend more time thinking about how to invest what you already have. If the numbers are close to each other, then you should spend time on both.

I. Saving

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This is why it is so much easier for higher income households to save money—they don’t spend on necessities at the same rate, relative to their income, as lower income households. Note - 3. How To Save More > Page 36 · Location 528 储蓄率

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“Why Do People Stay Poor?”

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“[ We] find that, if the program pushes individuals above a threshold level of initial assets, then they escape poverty, but, if it does not, they slide back into poverty… Our findings imply that large one-off transfers that enable people to take on more productive occupations can help alleviate persistent poverty.” 18

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many poor people stay poor not because of their talent/ motivation, but because they are in low-paying jobs that they must work to survive.

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This is why the biggest lie in personal finance is that you can be rich if you just cut your spending.

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If you want to save more, the main point is to tighten up where you can, then focus on increasing your income.

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Sell Your Time/ Expertise Sell a Skill/ Service Teach People Sell a Product Climb the Corporate Ladder

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Selling Your Time Summary Pros: Easy to do. Low startup cost. Cons: Time is limited. Doesn’t scale.

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Selling a Skill/ Service Summary Pros: Higher pay. Able to build a brand. Cons: Need to invest time to develop marketable skill/ service. Doesn’t scale easily.

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Teaching People Summary Pros: Easily scalable. Cons: Lots of competition. Attracting students can be an ongoing battle.

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The best way to do this is to identify a problem and then build a product to solve it. The problem could be emotional, mental, physical, or financial in nature. Whatever you decide on, solving a problem through a product helps you create scalable value.

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Selling a Product Summary Pros: Scalable. Cons: Lots of upfront investment and constant marketing.

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Climbing the Corporate Ladder Summary Pros: Gain skills and experience. Less risk around income growth. Cons: You don’t control your time or what you do.

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Regardless of how you try to increase your income in the future, all of the methods above should be viewed as temporary measures. I say temporary because, ultimately, your extra income should be used to acquire more income-producing assets. That’s how you really give your savings a boost.

II. Investing

Bookmark - 10. Why Should You Invest? > Page 114 · Location 1803

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why you should invest: To save for your future self. To preserve your money against inflation. To replace your human capital with financial capital.

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with an inflation rate of 5% annually, purchasing power is halved every 14 years.

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It is this highly volatile nature of stocks that makes them difficult to hold during turbulent times. Seeing a decade’s worth of growth disappear in a matter of days can be gut-wrenching even for the most seasoned investors.

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The best way to combat such emotional volatility is to focus on the long term. While this does not guarantee returns, the evidence of history suggests that, with enough time, stocks tend to make up for their periodic losses. Time is an equity investor’s friend.

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Stocks Summary Average compounded annual return: 8%–10%. Pros: High historic returns. Easy to own and trade. Low maintenance (someone else runs the business). Cons: High volatility. Valuations can change quickly based on sentiment rather than fundamentals.

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Why You Should/ Shouldn’t Invest in Bonds I recommend bonds because of these characteristics: Bonds tend to rise when stocks (and other risky assets) fall. Bonds have a more consistent income stream than other assets. Bonds can provide liquidity to rebalance your portfolio or cover liabilities.

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Bonds Summary Average compounded annual return: 2%–4% (can approach 0% in a low-rate environment). Pros: Lower volatility. Good for rebalancing. Safety of principal. Cons: Low returns, especially after inflation. Not great for income in a low-yield environment.

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Investment Property Summary Average compounded annual return: 12%–15% (dependent on local rental conditions). Pros: Higher returns than other more traditional asset classes, especially when using leverage. Cons: Managing the property and tenants can be a headache. Hard to diversify.

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REITs Summary Average compounded annual return: 10%–12%. Pros: Real estate exposure that you don’t have to manage. Less correlated with stocks during good times. Cons: Volatility greater than or equal to stocks. Less liquidity for non-traded REITs. Highly correlated with stocks and other risk assets during stock market crashes.

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Small Business Summary Average compounded annual return: 20%–25%, but expect lots of losers. Pros: Can have extremely outsized returns. The more involved you are, the more future opportunities you will see. Cons: Huge time commitment. Lots of failures can be discouraging.

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What About Gold, Crypto, Art, Etc? A handful of asset classes did not make the above list for the simple reason that they don’t produce income. Gold, cryptocurrency, commodities, art, and wine have no reliable income stream associated with their ownership, so I have not included them in my list of income-producing assets. Of course, this does not mean that you can’t make money with these assets. What it does mean is that their valuations are based solely on perception—what someone else is willing to pay for them. Without underlying cash flows, perception is everything. Note - 11. What Should You Invest In? > Page 147 · Location 2357 没有现金流

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Why You Shouldn’t Buy Individual Stocks

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The mental turmoil. The fear of missing out. The elation, triumph, pain, and regret. It was all perfectly packaged into a single two-hour window. Battling emotions is just the tip of the stock picking iceberg. I know because I used to pick stocks years ago as well. In addition to the emotional difficulties, you also have to deal with periods of underperformance and the possibility that you don’t actually have any stock picking skill.

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“The very best way to learn about the dangers of individual stock investing is to familiarize yourself with the basics of finance and the empirical literature. But if you can’t do that, then, sure, what you have to do is put 5% or 10% of your money into individual stocks. And make sure you rigorously calculate your return, your annualized return, and then ask yourself, ‘Could I have done better just by buying a total stock market index fund?’” 82

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Most stock markets go up most of the time. This is true despite the chaotic and sometimes destructive course of human history. As Warren Buffett so eloquently stated: “In the 20th century, the United States endured two world wars and other traumatic and expensive military conflicts; the Depression; a dozen or so recessions and financial panics; oil shocks; a flu epidemic; and the resignation of a disgraced president. Yet the Dow rose from 66 to 11,497.”

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Given this empirical evidence, it suggests that you should invest your money as soon as possible. Why is this? Because most markets going up most of the time means that every day you end up waiting to invest usually means higher prices you will have to pay in the future. So, instead of waiting for the best time to get invested, you should just take the plunge and invest what you can now.

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Imagine you have been gifted $ 1 million and you want to grow it as much as possible over the next 100 years. However, you can only undertake one of two possible investment strategies. You must either: Invest all your cash now, or Invest 1% of your cash each year for the next 100 years. Which would you prefer? If we assume that the assets you are investing in will increase in value over time (otherwise why would you be investing?), then it should be clear that buying now will be better than buying over the course of 100 years. Waiting a century to get invested means buying at ever higher prices while your uninvested cash also loses value to inflation.

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“The best time to start was yesterday. The next best time is today.”

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Why Better Prices in the Future are Likely (And Why You Shouldn’t Wait for Them)

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If you think that the market is overvalued and due for a major pullback, you may need to wait years, if ever, before you are vindicated. Consider this before you use valuation as an excuse to stay in cash.

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Final Summary When deciding between investing all your money now or over time, it is almost always better to invest it now. This is true across all asset classes, time periods, and nearly all valuation regimes. Generally, the longer you wait to deploy your capital, the worse off you will be.

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I say generally because the only time when you are better off by averaging-in over time is while the market is crashing. However, it is precisely when the market is crashing that you will be the least enthusiastic to invest.

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It is difficult to fight off these emotions, which is why many investors won’t be able to keep buying as the market falls anyways.

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If you are still worried about investing a large sum of money right now, the problem may be that you’re considering a portfolio that is too risky for your liking. What’s the solution to this? Invest your money now into a more conservative portfolio than you normally would.

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If your target allocation is a 80/ 20 stock/ bond portfolio, you might want to consider investing it all into a 60/ 40 stock/ bond portfolio and transitioning it over time.

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14. Why You Shouldn’t Wait to Buy the Dip Even God couldn’t beat dollar-cost averaging

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Why is this true? Because buying the dip only works when you know that a severe decline is coming and you can time it perfectly.

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The problem is that severe market declines don’t happen too often. In U.S. market history severe dips have only taken place in the 1930s, 1970s, and 2000s. That’s rare. This means that Buy the Dip only has a small chance of beating DCA.

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You should invest as soon and as often as you can.

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How much would the market have to decline in the next year for you to forgo investing in stocks altogether to invest in bonds instead?

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The answer is 15% and above.

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“If you’re not willing to react with equanimity to a market price decline of 50% two or three times a century, you’re not fit to be a common shareholder and you deserve the mediocre result you’re going to get.”

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As you can see, when U.S. equity markets have gotten cut in half, the future annualized returns usually exceed 25%. This implies that when the market is down by 50%, it’s time to back up the truck and invest as much as you can afford. Of course, you may not have a lot of investable cash to take advantage of these rare occurrences when the market is in turmoil, because of wider economic uncertainty. However, if you do have the cash to spare then the data suggests that it would be wise to take advantage of this buying opportunity.

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When Should You Sell? On rebalancing, concentrated positions, and the purpose of investing

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fear of missing out on the upside and the fear of losing money on the downside. This emotional vice can make you question every investment decision that you make.

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To avoid this mental turmoil, you should come up with a set of conditions under which you would sell beforehand instead of relying on your emotional state when you are thinking of getting out of a position. This will allow you to sell your investments on your own terms, to a predefined plan. After coming up with a list of reasons myself, I can only find three cases under which you should consider selling an investment: To rebalance. To get out of a concentrated (or losing) position. To meet your financial needs. If you aren’t rebalancing your portfolio, getting out of a concentrated (or losing) position, or trying to meet a financial need, then I see no reason to sell an investment—ever.

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it’s usually better to buy immediately rather than over time. The reasoning was simple: since most markets go up most of the time, waiting to buy usually means losing out on upside. When it comes to selling an asset, we can use the same set of reasoning, but come to the opposite conclusion. Since markets tend to go up over time, the optimal thing to do is to sell as late as possible. Therefore, selling over time (or as late as possible) is usually better than selling right away.

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buy quickly, but sell slowly.

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What’s Rebalancing Good for Anyways? “Perfectly balanced, as all things should be.”

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Given that rebalancing doesn’t typically enhance returns, why do people still do it? To reduce risk.

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result, I recommend an annual rebalance for two reasons: It takes less time. It coincides with our annual tax season.

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Whatever you decide to do when it comes to rebalancing frequency, avoiding unnecessary taxation is a must. This is why I don’t recommend rebalancing frequently in your taxable accounts (i.e., brokerage account). Because every time you do, you have to pay Uncle Sam.

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While selling an asset to rebalance isn’t the worst thing in the world, there is a way to rebalance your portfolio that involves no tax consequences at all—Just Keep Buying. That’s right. You can buy your way back into a rebalanced portfolio. I call this an accumulation rebalance because you are rebalancing by buying your most underweight asset over time.

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The point is that underperformance is inevitable and not a good reason to sell.

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Fund the life you need before you risk it for the life you want.

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Why You Will Never Feel Rich And why you probably already are

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The Most Important Asset And why you’ll never get any more of it

Including during World Wars and COVID-19 Most stock markets go up most of the time.

While it feels like we are always at the epicenter of a market crash, the fact is that major crashes are very rare. This is why Average-In has performed poorly for most of history.

The Best Time to Start Was Yesterday

The next best time is today. The best time to start was yesterday. The next best time is today.

• If we assume that the assets you are investing in will increase in value over time (otherwise why would you be investing?), then it should be clear that buying now will be better than buying over the course of 100 years. Waiting a century to get invested means buying at ever higher prices while your uninvested cash also loses value to inflation.
• If we assume that the assets you are investing in will increase in value over time (otherwise why would you be investing?), then it should be clear that buying now will be better than buying over the course of 100 years. Waiting a century to get invested means buying at ever higher prices while your uninvested cash also loses value to inflation.

Why There Might Be Better Prices in the Future

One trading day out of every 20 (one per month) will offer you an absolutely cheap price. The other 19 will leave you regretting your purchase at some point in the future. This is why it feels right to wait for lower prices. Technically, you have a 95% chance of being right.

Why You Shouldn’t Wait

Sometimes lower prices never appear, or you might have to wait a very long time to see that lower price. The most critical point is that you cannot time the market; you don’t know when the price will be better. Because “better” is a relative concept.

While it feels like we are always at the epicenter of a market crash, the fact is that major crashes are very rare. This is why Average-In has performed poorly for most of history.

Why did “Buy Now” perform so poorly compared to Average-In in August 2008?

Because the US stock market crashed shortly after August 2008. More specifically, if you invested $12,000 in the S&P 500 index at the end of August 2008, by the end of August 2009, you would only have $9,810 (including reinvested dividends), resulting in a total loss of 18.25%.

However, what you truly see in this chart is not the peak, but the line usually being below 0%. If the line is below 0%, Average-In performs worse than Buy Now, and when it is above 0%, Average-In performs better than Buy Now.

As you can see, most of the time, Average-In performs worse than Buy Now. This is not just recency bias. If we look at US stock returns since 1920, we find that in every rolling 12-month period, the average performance is 4.5% lower than “Buy Now,” and across all rolling 12-month periods, the average performance is 4.5% lower than “Buy Now.” The chart below illustrates this longer period in the same way as the previous chart.

What About Risk?

High returns inevitably bring high risk. Is it worth risking a larger drawdown for a potential 4% gain?

However, if you are worried about risk, then maybe you should consider following the Buy Now strategy and investing into a more conservative portfolio instead.

For example, if originally you were going to Average-In to a 100% stock portfolio, you could follow the Buy Now strategy into a 60/40 stock/bond portfolio to have slightly better returns for the same level of risk.

If you think that the market is overvalued and due for a major pullback, you may need to wait years, if ever, before you are vindicated. Consider this before you use valuation as an excuse to stay in cash.

Final Summary

When deciding whether to invest all funds now or invest over time, investing now is almost always better. This applies to all asset classes, time periods, and almost all valuation regimes. Generally speaking, the longer you wait to deploy your funds, the worse your situation will be.

The reason I say this is that over time, the only time you can improve by averaging in is when the market crashes. However, precisely when the market crashes, you are least inclined to invest.

Everyone is frantically selling, and you don’t know how far the market will fall.

It is hard to resist these emotions, which is why many investors cannot continue buying when the market is falling.

AI Q&A

The author’s core view is: stock markets go up most of the time, so investing early is better than diversifying, because waiting usually means missing out on upward opportunities. Historical data shows that the average cost method performs worse than lump-sum investing most of the time (76% to 82% of 12-month periods), especially when the market is generally trending upward. Even if lower prices might appear in the short term, the long-term gains from entering the market early are greater.

Validity of the Author’s Argument

Data Support

• The author provides sufficient historical data to support the argument.
• Analysis across multiple asset classes and time periods shows that lump-sum buying indeed yields higher average returns.
• Even during periods of high valuation, lump-sum buying is statistically superior.

Theoretical Basis

• The long-term upward trend of the market indeed supports the logic of investing early.
• Adjusting asset allocation to control risk is a reasonable suggestion.

Limitations of the Author’s Argument

Psychological Factors Not Fully Considered

• Investment decisions are not just mathematical and statistical issues.
• The psychological pressure of investing a large sum upfront may lead investors to make poor decisions during market downturns.
• One of the values of dollar-cost averaging (DCA) is helping investors build good investment habits and psychological resilience.

Differences in Individual Circumstances

• Different investors have different risk tolerances.
• The stability of income sources affects the choice of investment strategy.
• Differences in investment goals and time horizons should also be considered.

Real-world Complexity

• The real market environment is more complex than historical data.
• Factors such as macroeconomic conditions and policy changes can affect strategy performance.
• Past performance cannot fully predict the future.

Suggested Balanced Viewpoint

Strategy Combination

• One can consider combining lump-sum buying and dollar-cost averaging (DCA).
• For example, investing a portion of funds upfront while maintaining a regular investment habit.
• This way, you can gain the advantages of early investment while maintaining investment discipline.

Tailored to the Individual

• Choose the appropriate strategy based on specific individual circumstances.
• Consider your risk tolerance, investment experience, and financial goals.
• Choosing a method that allows you peace of mind is more important.

Dynamic Adjustment

• Regularly evaluate and adjust the investment strategy.
• Make appropriate adjustments based on changes in market conditions and personal circumstances.
• Maintain flexibility and adaptability.

Conclusion

The author’s analysis is convincing from a data and theoretical perspective, but investment decisions should not be based solely on historical data. Every investor needs to find a method that suits them, balancing rational analysis with psychological endurance. While DCA might be slightly inferior in terms of pure returns, its value in reducing psychological pressure and cultivating investment habits should not be overlooked.

由于最初财富的差异，贫困人口无法接触到更好的工作机会，只能从事低生产力的工作。

人们之所以贫穷，不是因为他们固有的特质，而是因为缺乏机会。他们的环境，才是让他们贫穷的原因。

If your expected savings are higher, then you need to focus more on saving money and adding to your investments. However, if your expected investment growth is higher, then spend more time thinking about how to invest what you already have. If the numbers are close to each other, then you should spend time on both.

Mistakes in the Last Judgment

• My first conscious speculative attempt, where I failed to adequately consider the factor of unfinished projects (or “rotten tails”).
• We may need to continuously correct our judgments, because the world is constantly changing.

Avoiding Extreme Thinking

• Being fixed on one side means falling into extreme thinking—believing that a certain strategy or concept can apply forever, or holding an absolute view of certain things. This mindset ignores the complexity and diversity inherent in reality. Dealing with life and responding to change requires balance; one cannot be overly aggressive, nor overly conservative.
• In economic decision-making, being fixed on one side might manifest as over-relying on a specific policy tool (such as monetary easing or fiscal stimulus), while ignoring long-term side effects. Similarly, in personal investment, if one relentlessly pursues a certain investment model, they may miss other potential opportunities.

Winning by Adapting to the Enemy’s Changes

• The world is full of uncertainty and variables, whether in politics, economics, or personal life. Facing these changes, rigidly adhering to a fixed strategy or concept leads to mistakes, or even missed opportunities. Adaptation means adjusting one’s behavior and strategy according to environmental changes, maintaining flexibility and adaptability.
• The concept of “winning by adapting to the enemy’s changes,” mentioned in Sun Tzu’s Art of War, also emphasizes the importance of responding to change. Whether facing a battlefield or various challenges in life, the ability to adapt to change often determines success or failure.

Balance and Moderation

• The Way of the Mean (Zhong Yong) emphasizes finding balance between extremes. True wisdom lies in knowing when to persist and when to change. This applies to life, career, investment, and politics. Timely adjustment not only avoids the difficulties brought by rigidity, but also allows us to better seize new opportunities.
• “Adaptation” is not blindly following change, but rather adjusting strategies according to the situation while maintaining core principles. This flexibility allows us to not lose direction amidst change, but also to effectively cope with challenges.

Open Mindset

• Responding to change also requires us to maintain an open mindset, always ready to accept new knowledge and new information. Often, success depends on whether we can timely realize the arrival of change and take corresponding action. Those who always adhere to old ideas and are unwilling to accept change are often eliminated in the changing tide.
• In the age of information explosion, maintaining openness and critical thinking is essential to avoid being misled and quickly adapting to new situations and challenges.

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Many people who have a great deal of wealth do not even live in upscale neighborhoods.

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Wealth is not the same as income. If you make a good income each year and spend it all, you are not getting wealthier.

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Many people ask this question of themselves all the time. Often they are hard-working, well-educated, high-income people. Why, then, are so few affluent?

许多人一直在问自己这个问题。他们通常是勤奋、受过良好教育的高收入人群。那么，为什么富裕的人如此之少呢？

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But 65 percent of the households have equity in their own home, and more than 85 percent own one or more motor vehicles. Cars tend to depreciate rapidly. Financial assets tend to appreciate.

但 65%的家庭拥有自己的房屋，超过 85%的家庭拥有一辆或多辆机动车。汽车往往会迅速贬值。金融资产趋于升值。

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1. They live well below their means.
2. 他们的生活远远低于他们的能力。
3. They allocate their time, energy, and money efficiently, in ways conducive to building wealth.
4. 他们以有利于积累财富的方式有效地分配时间、精力和金钱。
5. They believe that financial independence is more important than displaying high social status.
6. 他们认为经济独立比展示高社会地位更重要。
7. Their parents did not provide economic outpatient care.
8. 他们的父母没有提供经济门诊护理。
9. Their adult children are economically self-sufficient.
10. 他们的成年子女在经济上自给自足。
11. They are proficient in targeting market opportunities.
12. 他们精通瞄准市场机会。
13. They chose the right occupation.
14. 他们选择了正确的职业。

1: Meet the Millionaire Next Door

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How much money does it take to maintain the upper-middle-class lifestyle of an attorney and his family?
维持律师及其家人的中上层阶级生活方式需要多少钱？
How much money is required to maintain the middle-class or even blue-collar lifestyle of a mobile-home dealer and his family?
需要多少钱来维持移动房屋经销商及其家人的中产阶级甚至蓝领生活方式？
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显然，身为律师的福特必须拿出家庭收入中更多的钱来维持和展示其家庭中上层阶级的生活方式。

2: Frugal Frugal Frugal

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THEY LIVE WELL BELOW THEIR MEANS.
他们的生活远远低于他们的能力。
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What are three words that profile the affluent?
描述富人的三个词是什么？

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Financially independent people are happier than those in their same income/ age cohort who are not financially secure.
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Mr. Friend never really enjoys his life. He owns a lot of upscale things, yet he works so hard and for so many hours during a typical day that he has no time to enjoy them. He has no time for his family, either. He leaves his house each day before dawn and rarely returns home in time for dinner.
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Each year you are forced to maximize realized income just to make ends meet. You can’t afford to invest any money.
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If you’re not yet wealthy but want to be someday, never purchase a home that requires a mortgage that is more than twice your household’s total annual realized income.
如果您还不富裕，但希望有一天变得富有，那么永远不要购买需要抵押贷款的房屋，该抵押贷款超过您家庭年实现总收入的两倍。

3: Time, Energy, and Money

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THEY ALLOCATE THEIR TIME, ENERGY, AND MONEY EFFICIENTLY, IN WAYS CONDUCIVE TO BUILDING WEALTH.
他们以有利于积累财富的方式有效地分配时间、精力和金钱。
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PAWs allocate nearly twice the number of hours per month to planning their financial investments as UAWs do.
PAW每月分配的小时数几乎是 UAW的两倍，用于规划他们的金融投资。
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Many people tell us that you can judge a book by its cover, meaning that high-grade doctors, lawyers, accountants, and so on are expected to live in expensive homes. They also are expected to dress and drivein a style congruent with their ability to perform their professional duties. How do you judge the professionals you patronize?
Too many people judge them by display factors. Extra points are given to those who wear expensive clothes, drive luxury automobiles, and live in exclusive neighborhoods. They assume a professional is likely to be mediocre, even incompetent, if he lives in a modest home and drives a three-year-old Ford Crown Victoria. Very, very few people judge the quality of the professionals they use by net worth criteria. Many professionals have told us that they must look successful to convince their customers/ clients that they are.

很多人告诉我们，你可以通过封面来判断一本书，这意味着高级医生、律师、会计师等应该住在昂贵的房子里。他们还应该穿着和驾驶与其履行专业职责的能力相一致。你如何判断你所光顾的专业人士？太多人通过显示因素来判断它们。那些穿着昂贵衣服、驾驶豪华汽车和住在高档社区的人会得到加分。他们认为，如果一个专业人士住在一个简陋的家里，开着一辆三年前的福特皇冠维多利亚，他很可能是平庸的，甚至是无能的。很少有人通过净资产标准来判断他们使用的专业人士的质量。许多专业人士告诉我们，他们必须看起来很成功才能让他们的客户/客户相信他们是。

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这是做生意的成本之一
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I spend a lot of time planning my financial future.
我花了很多时间规划我的财务未来。
Usually, I have sufficient time to handle my investments properly.
通常，我有足够的时间妥善处理我的投资。
When it comes to the allocation of my time, I place the management of my own assets before my other activities.
在分配时间时，我把自己的资产管理放在其他活动之前。

4: You Aren’t What You Drive

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THEY BELIEVE THAT FINANCIAL INDEPENDENCE IS MORE IMPORTANT THAN DISPLAYING HIGH SOCIAL STATUS.
他们认为，经济独立比展示高社会地位更重要。
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If your goal is to become financially secure, you’ll likely attain it…. But if your motive is to make money to spend money on the good life, … you’re never gonna make it.
如果您的目标是在财务上获得安全，那么您很可能会实现它。但如果你的动机是赚钱，把钱花在美好的生活上，……你永远不会成功。
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It’s much easier in America to earn a lot than it is to accumulate wealth.
在美国，赚很多钱比积累财富要容易得多。

5: Economic Outpatient Care

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Whatever your income, always live below your means.
无论您的收入如何，都要始终入不敷出。

6: Affirmative Action, Family Style

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THEIR ADULT CHILDREN ARE ECONOMICALLY SELF-SUFFICIENT.
他们的成年子女在经济上是自给自足的。
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1. Never tell children that their parents are wealthy.
2. 永远不要告诉孩子他们的父母很有钱。
3. No matter how wealthy you are, teach your children discipline and frugality.
4. 不管你有多富有，都要教你的孩子纪律和节俭。
5. Assure that your children won’t realize you’re affluent until after they have established a mature, disciplined, and adult lifestyle and profession.
6. 确保您的孩子在建立成熟、自律和成人的生活方式和职业之前不会意识到您很富裕。
7. Minimize discussions of the items that each child and grandchild will inherit or receive as gifts.
8. 尽量减少讨论每个孩子和孙子将继承或作为礼物收到的物品。
9. Never give cash or other significant gifts to your adult children as part of a negotiation strategy.
10. 切勿将现金或其他重要礼物作为谈判策略的一部分送给您的成年子女。
11. Stay out of your adult children’s family matters.
12. 远离成年子女的家庭事务。
13. Don’t try to compete with your children.
14. 不要试图与你的孩子竞争。 Never boast about how much money you have accumulated.
15. Always remember that your children are individuals.
16. 永远记住，你的孩子是独立的个体。
17. Emphasize your children’s achievements, no matter how small, not their or your symbols of success.
18. 强调孩子的成就，无论多么渺小，而不是他们或你成功的象征。
19. . Tell your children that there are a lot of things more valuable than money.
20. .告诉孩子，有很多东西比金钱更有价值。

7: Find Your Niche 7：找到你的利基市场

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THEY ARE PROFICIENT IN TARGETING MARKET OPPORTUNITIES.他们善于瞄准市场机会。

• Extreme success largely depends on luck.
• Investing and wealth management isn’t entirely based on luck. It might be a bit like playing cards—there’s a significant element of luck, but also a certain level of skill.
• Personal financial investment is largely related to psychology.
• Investment behavior is strongly related to a person’s past experiences, because past experiences influence one’s psychology.

Chapter 1: No One Truly Loses Their Mind Over Money

In the United States, the lowest-income families spend an average of $412 annually on lottery tickets, which is four times the amount spent by high-income families. 40% of Americans cannot pull out even $400 when they urgently need money. This means that those who spend $400 on lottery tickets are essentially those who cannot produce $400 when they need it most. They are betting the $400 that could provide them with security on a chance of winning that is only one in a million.

Few people make financial decisions simply based on electronic reports. Decisions are often made while people are dining or in meetings. In these settings, personal experience, unique worldview, subjective self, pride, marketing tactics, and extraordinary incentives all work together to form the context that prompts you to make a decision.

The 401K plan—America’s main retirement system—only appeared in 1978; the Roth IRA was born in 1998. If we view the latter as a person, he has just reached the age of legal drinking.

Chapter 2: Luck and Risk

Nothing is as good or bad as it seems on the surface.

Scott Galloway, a professor at New York University, offers an interesting perspective, and it is crucial to remember this when judging one’s own or another’s success: “Nothing is as good or bad as it seems on the surface.”

You are more likely to gain valuable insights only when you seek universal patterns of success and failure. The more universal the pattern, the stronger its applicability to your life.

Posted on 2023/7/29

The longer the remaining health, the better; staying at the table increases the chances of winning.

The key to preventing failure is: having a solid financial plan so that it doesn’t collapse entirely due to one bad investment or an unmet financial goal, ensuring you can continue moving forward on the investment path until the moment good luck arrives.

Chapter 3: Perpetual Dissatisfaction

A considerable portion of readers of this book have found that the money they earn or the wealth they possess at certain points in their lives is enough to meet all reasonable needs in life and allow them to do many things they desire.

Chapter 4: The Mystery of Compound Interest

Warren Buffett’s financial net worth is $84.5 billion, of which $84.2 billion was earned after the age of 50, and $81.5 billion was earned after the age of 65—that much he earned starting from the age when he could begin receiving a pension.

If he had started investing around the age of 30 and retired at 60, few people would know about it.

Buffett treated investing as a career from the age of 10. By the age of 30, he had a net worth of $1 million. Considering inflation, this amount is equivalent to $9.3 million today. 

If he were an ordinary person, exploring the world and seeking passion like most people at the age of 10 or 20, how much wealth would he have by the age of 30? Perhaps $25,000?

What if that wealth continued to grow at an excellent annual rate (22%), but he ended his investment career at age 60, starting to spend his time playing golf and spoiling his grandchildren?

How much would his wealth be today?

Not $84.5 billion.

But only $11.9 million.

This figure is 99.9% less than his current net worth.

Chapter 5: Getting Rich vs. Keeping Rich

The fact that “the long-term result is positive, but the short-term process may be terrible” seems counterintuitive at first glance, but many things in life are indeed like this. By the time a person reaches 20, the number of synapses in their brain has shrunk to half of what it was at age 2, because inefficient and redundant neural connections have been cleared, yet clearly, a 20-year-old is much smarter than a 2-year-old. Destruction is a frequent process on the path forward, but it is also an effective way to refine and select the best.

Imagine you are a parent with X-ray vision, able to see inside your child’s brain. Every morning, you would find that the neural synapses in your child’s brain have decreased a little more. You would panic and say, “This is wrong; the synapses are getting fewer. Something must be wrong; we must do something, we need to see a doctor!” But fortunately, you don’t have X-ray vision. What you are seeing is merely the child’s normal process of growth.

The economy, the market, and personal careers usually follow a similar path—a process of continuous growth amidst constant losses.

You need short-term vigilance to allow yourself to survive, so that you can see the long-term optimistic results.

Chapter 7: Freedom

Time freedom is the greatest dividend wealth can bring you.

The highest form of wealth is being able to wake up every morning and say, “Today, I can do anything I want to do.”

If happiness has a common denominator—a universal source of joy—that is complete control over life.

The freedom to do what you want, when you want, and for as long as you want is extremely precious, and this is the greatest dividend that money can bring us.

John D. Rockefeller was one of the most successful businessmen in history. He was also a recluse, spending most of his time alone. He was taciturn, minimizing social interaction; even if you caught his attention, he would remain silent.

A refinery worker who became one of Rockefeller’s confidants once said, “He let everyone speak, while he himself leaned back in his chair, remaining silent.”

When someone asked him why he remained silent in meetings, Rockefeller often quoted a poem to answer:

A wise old owl lives on an oak tree,

The more it sees, the less it speaks,

The less it speaks, the more it listens,

Why can’t we be like this wise old owl?

Chapter 8: The Luxury Car Paradox

There is a paradox here: we all want to use wealth to tell others that we deserve their admiration and respect. But in reality, others often skip the admiration step. This is not because they feel your wealth is unworthy of envy, but because they use your wealth as a benchmark to express their own desire to be admired and respected.

You might think you need an expensive car, a luxury watch, and a big house, but let me tell you, you don’t truly want those things themselves. What you truly want is the respect and envy from others. You think owning expensive things will make others respect and admire you, but unfortunately, they won’t—especially those you hope to gain respect and admiration from.

Chapter 9: The Wealth You Cannot See

A person’s wealth is often invisible because it is the income that has not been spent that becomes wealth. Wealth exists before you make the purchasing decision. Its value lies in the options, flexibility, and growth potential it provides—the ability to buy more things in the future than you can buy today.

Chapter 10: Saving Money

The most effective way to increase wealth is not by raising personal income, but by cultivating your humility.

When you define savings as the difference between your ego and your income, you understand why many people with decent incomes find it difficult to save money. It is because they fight the instinct every day to show off and compare themselves to others who are also showing off.

Chapter 13: Margin of Error

The purpose of the margin of safety is to make prediction unnecessary.

The ability to do what you want, when you want, and for as long as you want is the source of infinite returns.

Chapter 14: People Change

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The Advantage of the Golden Mean

When you consider that your ideas will change over time, striving for balance at every node of life becomes a strategy to avoid future regret and maximize the duration of sticking to the plan.

When you consider that your ideas will change over time, striving for balance at every node of life becomes a strategy to avoid future regret and maximize the duration of sticking to the plan.

I have no sunk costs.

In a world where people change over time, sunk costs—unrecoverable expenditures caused by past decisions—are like a roadblock. They make us prisoners of who we were, forcing the future self to act like the past self. This is equivalent to letting a stranger make major life decisions for you.

Chapter 15: There Is No Free Lunch in the World

“Any job looks simple to an observer.”

Volatility is like a fee, not a penalty. Market returns are never free, and they can never be free. They demand a price from you, just like any other product. You are not forced to pay, just as you are not forced to go to Disney World. You could choose a local fair with a $10 ticket, or stay home for free. You might be just as happy, but usually, you get what you pay for. The market is the same. The cost of volatility/uncertainty—the price of obtaining returns—can be called the entry fee, allowing you to gain returns far higher than those offered by low-cost options like cash and bonds.

Chapter 19: Summary

This is because nothing is as good or bad as it seems on the surface. The world is vast and complex. Luck and risk truly exist.

The less vanity, the more wealth. How much you can save depends on the gap between your need for self-expression and your income, and wealth exists precisely in that unseen gap.

Some Reflections

How to Achieve Financial Freedom Through Buying and Selling Stocks

Buffett’s True Secret to Success

• Buffett does not borrow heavily.
• Buffett has endured 14 economic downturns, but none of them made him panic-sell his stocks.
• Buffett never tarnishes his business reputation.
• Buffett never clings to one strategy, one worldview, or one trend; he is always learning and never goes down a single path.
• Buffett does not rely on other people’s money to run the company.
• Buffett hasn’t exhausted himself, hasn’t quit, and hasn’t retired.

Buffett repeatedly emphasizes what is called “Margin of Safety.” His strategy requires that even during a massive bull market, you must always hold some cash. Others might be fully invested and earning a 9% return, but your cash might only yield 1% return. This feeling is difficult, but you must endure this discomfort to ensure that during a bear market, you still have money and are not forced to sell your stocks.

Making money is one thing, keeping wealth is another.

It is foolish to take risks with what you have and need in order to make money you don’t have and need. To make money they didn’t have, and didn’t need the risk what they did have and did need and that’s foolish. It is reasonable to invest a small portion of income without affecting quality of life. But people must be careful of the “Never Enough” impulse, and should not take excessive risks (leverage, shorting stocks, pushing legal boundaries, etc.) to pursue more wealth, but should focus on wealth preservation and slow growth through compounding for sustainable development.

Loving risk can make you money, but it can also make you lose money.

• Earning money requires luck, optimism, and a willingness to take risks.
• Keeping money requires avoiding risk, extreme humility, and fear.

The Straight-A Student vs. The Treasure Hunter

The Straight-A Student

This mindset is like those good students in school who want to get good grades in every subject and fear having any weaknesses. If this person does ten things, they expect to do at least nine well, and they will apologize for the one that wasn’t done well.

But the straight-A student mindset is actually an employee mindset. Everything you do is assigned and must be done. So, if you don’t know what to do right now, or what the consequences of every action will be. If you are an entrepreneur, investor, or leader, this employee mindset won’t cut it.

The Treasure Hunter

Those who invest know that investment portfolios have a strong “tail effect.” Often, most of the projects you invest in will fail, but a few will achieve extreme success, and almost all of your returns will come from those extremely successful projects. This effect is the “80/20 Rule” in investing. Moreover, this “investment” is broad, not limited to stock trading.

The key to the Treasure Hunter mindset is casting a wide net. You estimate there might be gems in this entire mine, so can you say you only explored the spot with gems? Can you say you only bought the pit with gems? You must control the entire area. Football schools, celebrity management, copyright agencies, IP adaptations—all follow this mindset.

We live in a world where “good things” are distributed very unevenly.

• In your lifetime, perhaps only a few books will have the deepest impact on you.
• Perhaps only one or two skills will determine your future.
• Perhaps only a few events will change your destiny.
• Perhaps only a few people are the most important to you.

You must cast a wide net, try many things, and expand your search scope, not fearing the waste of time and money, to ensure you find the best few.

If you only do what is “right” or what history has proven viable, your path will narrow.

Why Ambitious People Live in Disappointment

These are truly “gray” days. You didn’t sell at the last high, and you don’t know when the next high will come. The current point only brings disappointment. These are the days when a top student scores 97 points.

Investing is an activity everyone can participate in, and it provides direct feedback on your decisions. In particular, investing shows you whether you can face the real world.

So, if you are an ambitious person, your life is one of pursuing occasional satisfaction amidst disappointment.

• The decision was rushed (or hasty).
• The methods were intense (or aggressive).
• The effects were extreme.
• The outcome was incomplete (or a failure/poorly executed).

Therefore, when we make decisions, we must take this into account. We cannot assume that the intentions of those above will necessarily be realized. Nothing is omnipotent; there are always difficulties. There is no omnipotent god, and the central bank is no exception.

Endless desire is one of the pitfalls of human nature, and one of the first things you need to cure if you want to get ahead more quickly.

What will you do when you no longer have to work for money?

to leave this world a little better than we found it.

The Money Trap: The Old Road Map for Money

We Aren’t Making a Living, We’re Making a Dying
For so many working people, however, from people who love their work to those who barely tolerate their jobs, there seems to be no real choice between their money and their lives. What they do for money dominates their waking hours, and life is what can be fit into the scant remaining time.

Money Ain’t What It Used to Be—and Never Was

Money is something you trade your life energy for. You sell your time for money. It doesn’t matter that Ned over there sells his time for a hundred dollars and you sell yours for twenty dollars an hour. Ned’s money is irrelevant to you. The only real asset you have is your time. The hours of your life.

Money is life energy

Money is also like water—it flows, and as it flows, it nourishes life.

Knowing money is life energy allows you to maximize and optimize your most precious resource: your time; your life.

Now that you know that money is something you trade life energy for, you have the opportunity to set new priorities for your use of that valuable commodity. After all, is there any “thing” more vital to you than your life energy?

Men do not desire to be rich, only to be richer than other men.

Enough for you may be different from enough for your neighbor—but it will be a figure that is real for you and within your reach.

When you are financially independent, the way money functions in your life is determined by you, not by your circumstances.
当你经济独立时，金钱在你生活中的运作方式是由你决定的，而不是由你的环境决定的。

1. Establish (accurately and honestly) how much money you are trading your life energy for, and discover your real hourly wage.
2. Learn about your money behavior by keeping track of every cent that comes into and goes out of your life.

Where Is It All Going?

budget can be an amazing tool to lasso your wild spending and get it to behave.

You need to identify and follow internal signals, not external admonishments or habitual desires. You need to observe and adjust your patterns of spending over the long term, not what you spend over the short term.

Where to Stash Your Cash for Long-Term Financial Freedom

CHECKLIST OF THINGS TO CONSIDER WHEN INVESTING

• Is this investment in line with my values?

• Is this investment in line with my tolerance for risk?

• Does this provide overall diversification for my investments?

• Does this provide the current and future income I need?

• How easily can I liquidate (sell out of) all or part of this investment?

• What sales charges or penalties (if any) will I incur in getting into or out of this investment?

• What are the federal, state, and local tax implications of this investment for me?

• (Is it tax efficient for my income bracket or situation?)

• What are you putting in place now to keep you afloat as you age?

• In a pinch, what could you do to make extra money?

• Whom or what would you trust to help you invest your money?

• What’s been your experience to date with investing?

• What are your hopes?

• What values and beliefs do you bring to investing?

• What is your risk tolerance—in money and life?

• What does Financial Independence mean to you?

Trading Summary

This afternoon, I executed a trade in my A-share account, selling 50% of my shares in Industrial and Commercial Bank of China (ICBC).

Trading Rationale

Today, small-cap stocks experienced an overall decline, while major large-cap stocks rose by 4% to 5%. Concurrently, the Ministry of Finance announced that a press conference will be held on Saturday. My analysis suggests that policymakers intend to temporarily stabilize the market by boosting large-cap stocks and enhancing market confidence by releasing relevant news. I anticipate that concrete policies will be announced at the Saturday press conference to drive a market recovery. Given that the policymakers’ objectives have not yet been met, I believe they will not abandon their intervention in the market.

Specific Trading Process

Based on the analysis above, I decided to sell in two batches today and tomorrow, selling 50% of my holdings each time. Simultaneously, I plan to gradually buy back these shares on Monday and Tuesday of next week.

Reflection and Lessons Learned

This operation violated my most important principle: do not try to time the market. However, I wanted to test whether my recent understanding was correct through practical application. I must also admit that a profit-seeking mindset was intertwined with this operation. This experience made me realize that speculation is not just a test of the market, but also a test of one’s own emotions and judgment.

AI Evaluation of This Operation

From this journal entry, we can analyze the author’s mindset and behavior as follows:

Analytical Ability

The author demonstrates keen observation and analytical ability regarding market trends. He noticed the phenomenon of small-cap stocks declining and large-cap stocks rising, and linked it to government policy, attempting to understand the underlying market drivers.

Decision-Making Process

Based on his analysis, the author made a short-term investment decision—selling a portion of his holdings and planning to repurchase them within the next few days. This indicates that he is attempting to profit from short-term market fluctuations.

Self-Awareness

The author realized that this operation violated one of his important principles—not trying to time the market. This shows a clear understanding of his investment strategy and a strong emphasis on adherence to principles.

Curiosity and Self-Validation

Despite violating the principle, the author decided to proceed with this operation, partly because he wanted to validate his market judgment. This reflects a certain curiosity and a spirit of self-challenge.

Greedy Mindset

The author frankly admitted that beyond validating his judgment, the desire to make money drove this decision. This honesty indicates a clear recognition of his own motivations.

Risk Management

Although the author decided to engage in market timing, he adopted a phased selling strategy, selling only 50% of his holdings each time. This shows that while taking risks, he is also attempting to control them.

Self-Reflection

By recording this decision-making process and his thoughts, the author demonstrates a degree of self-reflection. He clearly recognizes the contradiction between his actions and his principles, and this reflection may help him make better decisions in the future.

Overall, this investor exhibits analytical ability, decision-making capability, self-awareness, curiosity, and risk management awareness, but also displays a certain degree of speculative psychology. His behavior reflects a common psychological conflict among investors—seeking balance between adhering to long-term principles and seizing short-term opportunities. This experience may become a valuable learning experience in his investment journey.

Areas for Improvement

• Adherence to Principles: Professional investors need clear investment principles and must stick to them. He violated his important principle, which could lead to unstable investment performance.
• Emotional Control: Admitting the greedy desire to make money, professional investors need to better control this emotion to prevent it from influencing their judgment.
• Short-Term Bias: Trying to time the market is a strategy that many professional investors struggle to succeed with long-term. More focus is needed on long-term value.
• Validation Method: While using “real money” to test his judgment is direct, it carries high risk. Professional investors usually use more systematic and risk-controlled methods to validate investment hypotheses.

Suggestions

1. Establish stricter investment discipline to avoid violating his set principles.
2. Develop a more systematic risk management strategy.
3. Try establishing a simulated trading account to validate investment ideas, rather than using actual capital.
4. Focus more on long-term investment strategies and reduce attention to short-term market fluctuations.
5. Continue to maintain the habit of analyzing the market and self-reflecting, but focus more on translating these analyses into sustainable investment strategies.

Enemy of Clear Thinking

Never forget that your unconscious is smarter than you, faster than you, and more powerful than you. It may even control you. You will never know all of its secrets. 永远不要忘记，你的潜意识比你更聪明，比你更快，比你更强大。它甚至可能控制你。你永远不会知道它的所有秘密。

Criticizing others is easier than coming to know yourself. 批评别人比了解自己更容易。

I never allow myself to have an opinion on anything unless I know the other side’s argument better than they do. 发言者在表达自己的观点之前，会确保自己充分理解并掌握了与自己相对立的观点，甚至比持有这些观点的人更深入地了解。这种态度表明了对全面思考和公正性的高度重视，只有在全面掌握双方论据后，才会形成并表达自己的看法。

Life gets easier when you don’t blame other people and focus on what you can control. 当你不责怪别人并专注于你能控制的事情时，生活会变得更容易

Decision-Making: Clear Thinking in Action

Defining the Problem

If you choose not to decide, you still have made a choice. 如果你选择不做决定，你仍然做出了选择。

Defining the problem starts with identifying two things:

1. What you want to achieve
2. What obstacles stand in the way of achieving it.

THE DEFINITION PRINCIPLE: Take responsibility for defining the problem. Don’t let someone define it for you. Do the work to understand it. Don’t use jargon to describe or explain it. 定义原则：负责定义问题。不要让别人为你定义它。做工作来理解它。不要使用行话来描述或解释它。 THE ROOT CAUSE PRINCIPLE: Identify the root cause of the problem. Don’t be content with simply treating its symptoms. 根本原因原则：确定问题的根本原因。不要满足于简单地治疗其症状。

Exploring Possible Solutions

Once you’re clear on the problem, it’s time to think of possible solutions—ways of overcoming the obstacles to get what you want. The way to come up with possible solutions is by imagining different possible futures—different ways the world could turn out. 一旦你弄清楚了问题，就该考虑可能的解决方案了——克服障碍以获得你想要的东西的方法。想出可能的解决方案的方法是想象不同的可能未来——世界可能变成不同的方式。

One of the most common errors at this stage of the decision-making process is avoiding the brutal realities. 在决策过程的这个阶段，最常见的错误之一是避免残酷的现实。

THE OPPORTUNITY-COST PRINCIPLE: Consider what opportunities you’re forgoing when you choose one option over another. 机会成本原则：考虑当您选择一个选项而不是另一个选项时，您会放弃哪些机会。

The second principle is closely related: 第二个原则密切相关： THE 3-LENS PRINCIPLE: View opportunity costs through these three lenses: 三视角原则：通过这三个视角看待机会成本：

• (1) Compared with what?
• (2) And then what?
• (3) At the expense of what?[*]

Do it

You’ve considered these options. You’ve evaluated them. You’ve found the best. It’s time to act! 您已经考虑过这些选项。你已经评估了它们。你已经找到了最好的。是时候采取行动了！

There is no purpose to knowing what you should do and not doing it. If you want results, you need action. 知道你应该做什么和不做什么是没有目的的。如果你想要结果，你需要行动。

Consequential decisions affect the things that matter most: whom you marry, where you live, which business you launch. The more a decision affects what matters to you—either in the short term or the long term—the more consequential it is. 重大决策会影响最重要的事情：你嫁给谁，你住在哪里，你开展哪项业务。一个决定对你的影响越大——无论是短期还是长期——它就越重要。

Three Principles of Action

THE ASAP PRINCIPLE: If the cost to undo the decision is low, make it as soon as possible.

尽快原则：如果撤销决定的成本很低，请尽快做出。

THE ALAP PRINCIPLE: If the cost to undo a decision is high, make it as late as possible.

阿拉普原则：如果撤销决策的成本很高，请尽可能晚。

When the stakes are high, and there are no take-backs, you want to decide at the last moment possible, and keep as many options on the table as you can while continuing to gather information. 当赌注很高，而且没有收回时，你要在最后一刻做出决定，并在继续收集信息的同时尽可能多地保留选择。

“THE STOP, FLOP, KNOW” Principle

This principle is used to help people determine when to stop gathering information and make a decision. The core idea of this principle is to avoid getting stuck in over-analysis and taking action in a timely manner. It consists of three parts:

STOP: When you can no longer gather useful information, you should stop gathering data and make a decision. That is, if continued collection will not bring substantial help to the decision, then it is time to stop.

FLOP (First Lose an Opportunity): If you have already missed an important opportunity, it means you waited too long, and it might be time to make a decision. This point reminds you not to miss the timing due to hesitation or over-analysis.

KNOW: When you receive a key piece of information that is sufficient to make it clear which option you should choose, you should make the decision immediately. This means if a piece of information has already made your choice obvious, then don’t delay any further.

Margin of Safety

A margin of safety is like having insurance. If you know in advance you won’t need to make a claim this year, it’s a waste of money to buy insurance. The problem is that you don’t know in what year you’ll need to make a claim, so you buy it every year. It might seem like a waste of money in years when nothing happens, but it shows its real value in years when something does. 安全边际就像有保险一样。如果您提前知道今年不需要提出索赔，那么购买保险就是浪费钱。问题是你不知道在哪一年需要提出索赔，所以你每年都会购买。在什么都没发生的时候，这似乎是在浪费钱，但在发生事情的年份里，它显示了它的真正价值。

TIP: The margin of safety is often sufficient when it can absorb double the worst-case scenario. Therefore, the baseline for a margin of safety is one that can withstand twice the amount of problems that cause a crisis, or maintain twice the amount of resources needed to rebuild after a crisis. 提示：当安全边际可以吸收两倍的最坏情况时，安全边际通常就足够了。因此，安全边际的基线是能够承受两倍于导致危机的问题，或者保持两倍于危机后重建所需资源的数量。

Yet even established patterns aren’t foolproof. As Nassim Taleb writes in The Black Swan, “Consider a turkey that is fed every day. Every single feeding will firm up the bird’s belief that it is the general rule of life to be fed every day by friendly members of the human race ‘looking out for its best interests,’ as a politician would say. On the afternoon of the Wednesday before Thanksgiving, something unexpected will happen to the turkey. It will incur a revision of belief.” Our outcomes can sometimes upend even our most well-established expectations. 然而，即使是既定的模式也不是万无一失的。正如纳西姆·塔勒布（Nassim Taleb）在《黑天鹅》（The Black Swan）中所写的那样，“想想每天喂食的火鸡。每一次喂食都会坚定这只鸟的信念，即每天由友好的人类成员喂食是生命的一般规则，正如政治家所说的那样，“为它的最大利益着想”。感恩节前的星期三下午，火鸡会发生意想不到的事情。这将导致信仰的修正。我们的结果有时甚至会颠覆我们最既定的期望。

However, if you have a lot of expertise and data, you can reduce your margin of safety yet further. Here’s an example: Warren Buffett aims to buy stocks that are 30–50 percent less than their true value. So he has a 30–50 percent margin of safety on stocks. But he’ll pay close to a dollar on the dollar for stocks that he understands well. So there’s only maybe a 20 percent margin of safety on the stocks he’s the most confident in. 但是，如果您拥有大量专业知识和数据，则可以进一步降低安全边际。举个例子：沃伦·巴菲特（Warren Buffett）的目标是购买比真实价值低30-50%的股票。因此，他在股票上有30-50%的安全边际。但他会为他熟悉的股票支付接近一美元的价格。因此，他最有信心的股票可能只有20%的安全边际。

One of Warren Buffett’s core tenets for buying a business is that if he doesn’t understand it, he doesn’t buy it. In other words, if he doesn’t have enough information to calculate a margin of safety, he doesn’t invest at all. He also knows that not all margins of safety will protect him—the goal isn’t to get it perfect for every stock he buys; it’s to use the best possible strategy for all his stocks in the big picture. 沃伦·巴菲特（Warren Buffett）购买企业的核心原则之一是，如果他不了解它，他就不会购买它。换句话说，如果他没有足够的信息来计算安全边际，他根本不会投资。他也知道，并非所有的安全边际都能保护他——目标不是让他购买的每一只股票都完美无缺;这是在大局中为他的所有股票使用最佳策略。

Here’s the bottom line: Predicting the future is harder than it seems. Things are great until they’re not. If things are good, a margin of safety seems like a waste. When things go wrong, though, you can’t live without it. You need a margin of safety most at the very moment you start to think you don’t.

Wanting What Matters

Think of yourself as dead. You have lived your life. Now take what’s left and live it properly.

GOOD DECISION-MAKING COMES down to two things: 好的决策归结为两件事：

1. Knowing how to get what you want
2. Knowing what’s worth wanting

According to reports from the Securities Times, on October 9th, the two A-share markets showed a weak downward trend, accelerating into a sharp plunge at the close. The Shanghai Composite Index fell nearly 7%, losing the 3300-point threshold, while the ChiNext Index dropped by over 10%. The total trading volume for both markets exceeded 2.9 trillion RMB, and more than 5,000 individual stocks declined.

Reasons for the Surge

Regarding the previous market surge, I have already provided an analysis in an earlier article. Interested readers can view the article 《On the Historic Surge Day of A-Shares: False Prosperity or Steady Ascent?》 for further details.

The Essence of This Plunge

To understand the underlying reasons for this plunge, we must first review several key assumptions:

1. The Goal of Policymakers: To prevent the economy from falling into an asset-liability recession similar to the Great Depression, decision-makers chose to rescue the economy through monetary policy.
2. The Stock Market as a Policy Tool: The central bank drives the stock market upward by purchasing stocks on a massive scale, creating an asset bubble, and helping enterprises obtain liquid funds.
3. Inflation and Capital Flow: Policymakers hope that through inflation, bank depositors will be forced to withdraw their deposits from the banks and invest them in other economic sectors, thereby pushing the economy out of deflation.

Since the implementation of these policy tools, the market has experienced significant short-term gains. However, today’s plunge signals that the policy effects are being tested by market reality.

Today’s Market Reality

Today, A-shares plunged sharply by 6% after opening, but looking at the overall situation, investors’ losses are not yet evident. This is because the stock market has already risen by about 20% over the past two weeks, partially mitigating the impact of the short-term decline.

More notably, many veteran investors who experienced the 2016 stock crash have still not entered the market. The veteran investors in a certain automotive sector that I have been closely monitoring remain cautious, showing high vigilance toward the stock market. This phenomenon indicates that despite the market experiencing a rapid short-term rise and sudden drop, the psychological trauma caused by the historic crash has not dissipated, and investor confidence has not yet recovered.

The cautious attitude of these veteran investors suggests that short-term market volatility is insufficient to overcome their concerns about market fundamentals. Speculative sentiment is rampant in the market, with many adopting a “make a quick profit and leave” mindset, as everyone generally believes that the economic fundamentals have not fundamentally improved.

Analysis of the Plunge’s Causes

Today’s plunge was primarily driven by two factors:

1. Realization of Prior Gains: After the market rose significantly, some investors chose to take profits at this time.
2. Policy Below Expectations: The new policy announced yesterday was far below market expectations, leading to a shift in market sentiment toward pessimism and exacerbating today’s decline.

Future Outlook

I do not believe that this round of market volatility signifies the end of the upward trend. On the contrary, it may just be the beginning of a new cycle of fluctuations. Under the guidance of policy and capital, the market is likely to continue rising amidst volatility. This is the strategy adopted by decision-makers to achieve their economic goals.

Although the Central Bank’s policies are not infallible in the long run, in the medium to short term, the Central Bank’s policies and capital support have a decisive influence on market direction. Therefore, we may see more similar fluctuations and reversals in the future.

Today, the Shanghai Composite Index opened higher by 10%, but immediately slid down, ultimately closing up 4.59% at 3,489 points. The total trading volume of the two markets reached a massive 3.45 trillion yuan, setting a new historical high. What is particularly noteworthy is that almost all stocks hit the upper limit at the opening, regardless of whether their performance was good or bad, or whether their P/E ratio was high or low. This market trend can be described as a unique phenomenon unseen in decades.

Questions Behind the Miracle

Behind this phenomenon, we cannot help but ask:

1. Has the economy truly begun to recover?
2. Has the business environment improved?
3. Has investment started to accelerate?
4. Has consumer intent increased?

Clearly, the answer is no. The market frenzy does not stem from a substantial improvement in economic fundamentals, but rather appears to be the result of human intervention.

Has the Market Reached a Cyclical Peak?

Currently, the market seems to have reached a cyclical peak, but this does not mean the upward trend will immediately end. In fact, the driving force behind this round of market activity is far more than just market sentiment; it is more complex, involving multiple economic and policy factors.

The Fundamental Reason for This Market Rally

Since the economy peaked in 2022, the Chinese economy has gradually entered a deflationary channel. The Purchasing Managers’ Index (PMI) has continuously remained in the contraction zone below 50, total social retail sales growth has stagnated, and the real estate market bubble has begun to burst. Even when some cities lifted purchase restrictions and banks lowered down payments to 15%, real estate prices have still fallen by an average of about 30% over the past two years. Consequently, local governments’ land finance has suffered a severe blow.

Meanwhile, youth unemployment has soared to 18%, and local government debt pressure is increasing. Facing such a severe economic situation, simply relying on the slogan of “praising the economy” is no longer enough to reverse the decline; monetary and fiscal policies must be utilized to alleviate the local financial crisis and the youth unemployment problem.

On September 24th, the central bank implemented interest rate cuts and reserve requirement ratio cuts, providing liquidity support to securities, fund, and insurance companies through a repurchase mechanism. These financial institutions exchanged highly liquid assets such as government bonds and central bank bills for the liquidity required by the market, thereby stabilizing the stock market.

These policy measures directly drove the stock market rally, creating a round of stock market asset bubble. Listed companies thus gained ample capital liquidity, and local governments could alleviate debt pressure by selling shares of state-owned enterprises. Individual investors participated, achieving asset appreciation while simultaneously driving consumption recovery, providing short-term momentum for the economy to escape stagnation.

The Market’s Next Trend

After a week of trading, funds that entered the market early began realizing profits, leading to today’s phenomenon of opening high and falling low. At the same time, the Hong Kong stock market has also started to decline. Does this mean the market euphoria is about to end?

I believe that although the market may experience short-term volatility, the fundamental driving force behind this rally—the support from monetary and fiscal policies—has not yet ended. Therefore, the market’s upward trend may continue. To achieve its economic and policy goals, the government may introduce more easing policies, further increasing support for the market and continuing to drive the stock market higher.

Conclusion

The current market prosperity is exciting on the surface, but in the long run, an over-rise detached from economic fundamentals will ultimately be difficult to sustain.

Highlightg(yellow) - 02 Confirming Facts > Page 15 · Location 154 The objective existence of facts comes in two basic forms: things (objects) and events. Things are entities that exist, such as animals, vegetables, or mineral deposits. For example, the White House can be seen as a representative of a thing, while Lincoln’s assassination can be seen as a representative of an event.

Highlightg(yellow) - 02 Confirming Facts > Page 15 · Location 158 To confirm the existence of a thing, you simply need to conduct an on-site investigation.

Highlightg(yellow) - 02 Confirming Facts > Page 15 · Location 162 However, how do we prove the authenticity of an event, such as Lincoln’s assassination?

Highlightg(yellow) - 02 Confirming Facts > Page 15 · Location 164 We can only rely on certain things that can serve as indirect evidence. For instance, official records (police reports, death certificates, etc.), contemporary newspapers, photographs, memoirs, diaries, and congressional archives. All these authoritative sources from different fields can only be explained by the fact that Lincoln was assassinated.

Highlightg(yellow) - 02 Confirming Facts > Page 15 · Location 167 Facts can be considered objective or subjective. Things and events are objective; they exist in the public domain and are, in principle, accessible to everyone. A subjective fact is a fact confirmed either through personal experience or indirectly through the experience of others. For example, a headache is a subjective fact; if I experience a headache, I have firsthand evidence of its authenticity. But if you have a headache, not me, I can only establish my concept of a headache by indirectly hearing you describe your headache. Therefore, the confirmation of a subjective fact completely depends on the reliability of the person claiming to have the headache.

Highlightg(yellow) - 02 Confirming Facts > Page 16 · Location 174 Just as with indirectly verifying the authenticity of a thing, when verifying the truth or falsity of an event using indirect evidence, we must pay sufficient attention, because seriously scrutinizing the authenticity and reliability of the evidence source is the most important thing.

Highlightg(yellow) - 03 Concepts and Their Objects > Page 16 · Location 180 A correct concept faithfully reflects the objective order of its object; conversely, an incorrect concept is a distorted expression of the objective world.

Highlightg(yellow) - 05 Concepts and Facts > Page 18 · Location 198 Human cognition is mainly formed by three parts: (1) objective things; (2) the reflection of those things in the brain; and (3) the language we create for them, through which we can communicate with others. Taking the cat as an example, first there must be a cat, and only then can we establish the concept of a cat, followed by the universally recognized word “cat.” Everything originates from the objective existence of the cat; without this objective existence, there can be no concept or language about the cat.

Highlightg(yellow) - 05 Concepts and Facts > Page 19 · Location 206 Complex concepts refer to concepts that do not correspond one-to-one with objective things. Such concepts usually have multiple sources in the objective world. For example, democracy—is it a clear and specific concept? At least subconsciously, yes, because we can link it to the objective world. However, the connotation of democracy has rich sources: people, events, constitutions, legislative actions, the old regime, and the new regime, among others. If I want to discuss democracy with others, to avoid falling into the subjective trap and being unable to communicate, I must discuss things that everyone understands in reality; I must constantly involve various events in reality, and these events are the real soil of the democratic connotation.

Highlightg(yellow) - 06 Expressing Concepts in Language > Page 20 · Location 226 Language must faithfully express the original appearance of objective things, thereby giving our communication a solid factual basis. Note - 06 Expressing Concepts in Language > Page 20 · Location 227 Thus, language can also be poisoned to deceive the masses.

Highlightg(yellow) - 07 Effective Communication > Page 21 · Location 238 In logic, a statement has a specific meaning; it is a specific linguistic expression that applies only to propositions that can be judged as true or false.

Highlightg(yellow) - 07 Effective Communication > Page 21 · Location 239 Words are called the foundation of language, and propositions are the foundation of logic.

Highlightg(yellow) - 07 Effective Communication > Page 21 · Location 240 Logic itself is the study of discovering the truth and separating it from error.

Highlightg(yellow) - 07 Effective Communication > Page 21 · Location 243 Communication. If a person doesn’t even understand what they are thinking, how can they clearly express it to others?

Highlightg(yellow) - 07 Effective Communication > Page 22 · Location 246 Don’t assume that your audience will grasp the meaning you haven’t directly expressed.

Highlightg(yellow) - 07 Effective Communication > Page 22 · Location 248 Ignorance. When we are unsure, it is best to clearly state the background information; rambling is always better than missing a critical point.

Highlightg(yellow) - 07 Effective Communication > Page 22 · Location 249 Use complete sentences.

Highlightg(yellow) - 07 Effective Communication > Page 22 · Location 253 Don’t treat a subjective view as an objective fact. Mount Tai is between Shandong and Shanxi—this is a proposition based on objective facts; it is either true or false. But if I say, “Mount Tai is beautiful,” this proposition mixes subjective and objective factors. In this case, we absolutely cannot arbitrarily judge the truth or falsity of a subjective proposition, as we just did. The truth or falsity of an objective proposition is undisputed, but that of a subjective proposition is not. If I want a certain subjective proposition to be accepted by everyone, I must argue for it.

Highlightg(yellow) - 07 Effective Communication > Page 23 · Location 257 Avoid double negatives.

Highlightg(yellow) - 07 Effective Communication > Page 23 · Location 261 Choose language appropriate to the object.

Highlightg(yellow) - 08 Avoiding Vague and Ambiguous Language > Page 24 · Location 276 One way to avoid ambiguity is to ensure that the words you use reflect your intended meaning as specifically as possible, so that the reader or listener does not have to strain to guess what you mean.

Highlightg(yellow) - 08 Avoiding Vague and Ambiguous Language > Page 24 · Location 279 Words like “love,” “democracy,” “fairness,” “kindness,” and “evil” inherently have unclear meanings. This is not just because they lack a fixed referent, but also because their meanings are too broad. Therefore, even if two people use the same word (e.g., “love”), their meanings can be vastly different, or even contradictory. This is why, when using such words, they must be accurately understood. Before you try to convince someone that something is unfair, you must tell them how you define “unfair.”

Highlightg(yellow) - 09 Avoiding Evasive Language > Page 25 · Location 289 Try to speak plainly and directly to reduce the possibility of the listener misunderstanding your intended meaning. But this doesn’t mean you should be unrestrained; a person should be able to perfectly combine conciseness with elegance.

Highlightg(yellow) - 10 Truth > Page 26 · Location 297 All logical reasoning and all arguments have only one purpose: to find the truth of a certain thing.

Highlightg(yellow) - 10 Truth > Page 26 · Location 300 Truth comes in two basic forms: ontological truth and logical truth. Ontological truth is the more fundamental. Ontological truth refers to truth concerning existence. If a thing is deemed to be an ontological truth, and it truly is, then it must exist somewhere. A lamp on a table is an ontological truth because it genuinely exists there, not merely as an illusion. The opposite of ontological truth is a false illusion.

Highlightg(yellow) - 10 Truth > Page 26 · Location 306 Definition of a Proposition: A linguistic expression that can be judged as true or false. To affirm a proposition is to judge it as true, and vice versa.

Highlightg(yellow) - 10 Truth > Page 27 · Location 311 Confirming the truth means achieving the unification of the subjective and the objective.

Highlightg(yellow) - 10 Truth > Page 27 · Location 314 The basis for determining the truth or falsity of a proposition is the actual situation, and logical truth is built upon the foundation of ontological truth.

Highlightg(yellow) - 10 Truth > Page 28 · Location 325 Language logic should be based on factual logic.

Chapter 2: Basic Principles of Logic

Highlightg(yellow) - 01 Basic Principles > Page 31 · Location 332 Logic is the analysis of thought.

Highlightg(yellow) - 01 Basic Principles > Page 31 · Location 340 Law of Identity: A thing can only be itself. This explains the rich and colorful reality, which is composed of countless individuals, and each individual is unique. A thing can only be itself, and not something else. An apple is an apple; it cannot be an orange, a banana, or a pear.

Highlightg(yellow) - 01 Basic Principles > Page 32 · Location 343 Law of Excluded Middle: For any judgment about a thing under certain conditions, there must be a clear “is” or “is not”; there is no intermediate state. This explains that a thing either exists or does not exist, with no middle ground. A lamp on a table—this statement is either true or false, with no other possibility.

Highlightg(yellow) - 01 Basic Principles > Page 32 · Location 353 Law of Sufficient Reason: Everything has a sufficient reason for its existence. This principle can also be called the principle of causality. It embodies the content that the existence of all things in the universe has a sufficient basis.

Highlightg(yellow) - 01 Basic Principles > Page 33 · Location 362 Law of Contradiction: At the same time, a thing cannot be both X and not-X in the same respect. This principle can be seen as an extension of the Law of Identity: if X is X (Law of Identity), then at the same time, it cannot be not-X (Law of Contradiction). The qualifier “in the same respect” refers to the mode of existence. At the same time, a thing can be both and not at different respects, which is not a contradiction.

Highlightg(yellow) - 02 Gray Areas and Man-Made Gray Areas > Page 36 · Location 400 Negation can only be confirmed when the positive is known.

Highlightg(yellow) - 03 Everything Has Its Origin > Page 37 · Location 411 There must be a fundamental similarity between every cause and its effect. This means that a cause must lead to the observed effect and leave its specific imprint on the result; in turn, every effect, to some degree, reflects the characteristics of its origin.

Highlightg(yellow) - 04 Don’t Give Up the Search for Causes > Page 37 · Location 421 The search for causes should not be abandoned halfway. Causes are often a series. For example, A is the cause of B occurring, and B’s occurrence leads to C. We can represent their relationship graphically: A → B → C. Let’s assume C represents a difficult problem in an event that needs to be remedied. We find that C is caused by B. Following the correct method for solving issues, we decide to focus on the cause of C, which is B. This logical approach is commendable, but it hasn’t gone far enough. B is indeed the direct cause of C, but it is not the root cause. The source of the causal chain is A, so A is the fundamental cause of problem C.

Highlightg(yellow) - 05 Distinguishing Causes > Page 39 · Location 439 Let’s analyze the “Four Causes” using the example of a birdcage. Its efficient cause is Fried, who manufactured it; its material cause is pine wood, nails, screws, and paint; its formal cause is the specific shape of the birdcage (which distinguishes it from, say, a filing cabinet or a window lattice); and its final cause is providing a place for small birds to perch.

Highlightg(yellow) - 05 Distinguishing Causes > Page 40 · Location 456 Even the best tool in the hands of an unqualified person will not yield the best results. Bookmark - 05 Distinguishing Causes > Page 40 · Location 457

Highlightg(yellow) - 06 Defining Terms > Page 40 · Location 459 The most effective way to avoid semantic confusion and ambiguity in a logical argument is to define terms. When we say “define terms,” we are actually defining the objective thing that the term represents. The process of definition is the process of giving it a precise “position” based on how it relates to other things (the thing being defined).

Highlightg(yellow) - 06 Defining Terms > Page 40 · Location 464 The logical process of defining terms is divided into two steps: First, placing the term to be defined into the closest category; second, determining its distinguishing characteristics from other things within that category.

Highlightg(yellow) - 06 Defining Terms > Page 41 · Location 466 The classic definition of a human is “a rational animal.” In this definition, “animal” is the closest category, the category most closely related to humanity. Why?

Highlightg(yellow) - 06 Defining Terms > Page 41 · Location 473 In Aristotle’s definition of man, “rationality” is the characteristic that distinguishes man from other animals. A specific distinguishing characteristic is called a genus (or property/attribute), and it determines a specific category and distinguishes it from other categories.

Highlightg(yellow) - 06 Defining Terms > Page 41 · Location 477 Justice: Step 1: “Justice is a social virtue…” Step 2: “…through justice, every member of society receives what is due to them.”

Highlightg(yellow) - 06 Defining Terms > Page 42 · Location 484 Fear: Step 1: “Fear is an emotion…” Step 2: “…that prompts us to avoid perceived danger.”

Highlightg(yellow) - 06 Defining Terms > Page 42 · Location 489 If we want to define “mobile phone,” Step 1 can be quite simple: the category is “communication device”; then, we must emphasize several specific distinguishing characteristics to differentiate it from other existing communication devices in the world.

Highlightg(yellow) - 06 Defining Terms > Page 42 · Location 490 The unique value of a logical definition lies in its ability to reveal the essence of the defined thing.

Highlightg(yellow) - 07 Assertive Propositions > Page 43 · Location 499 The most effective arguments have conclusions that are assertive propositions, clearly and explicitly telling us what the truth of a thing is.

Highlightg(yellow) - 07 Assertive Propositions > Page 44 · Location 504 A proposition may be assertive in form, but the content it expresses may still be incorrect. A person might say, “The Chicago Cubs are the best baseball team.” This is an assertive proposition, but it only tells us the speaker’s firm belief. It describes a subjective fact because it is merely the speaker’s opinion and does not reflect any objective reality.

Highlightg(yellow) - 08 Universal Propositions > Page 45 · Location 528 Logic is the technology that allows us to believe in the truth.

Chapter 3: Argumentation: The Language of Logic

Highlightg(yellow) - 01 Constructing an Argument > Page 48 · Location 534 A logician does not need to have seen or heard the Atlantic Ocean or Niagara Falls with their own eyes; they can infer the possibility of their existence from a single drop of water.

Highlightg(yellow) - 01 Constructing an Argument > Page 49 · Location 547 The most effective argument always tries to reach the simplest and clearest conclusion.

Highlightg(yellow) - 01 Constructing an Argument > Page 49 · Location 557 The premise is the foundation of the argument; a correct argument relies on correct premises. Therefore, the first step of a correct argument is to confirm the correctness of the premises.

Highlightg(yellow) - 03 From Particular to Universal > Page 50 · Location 568 The process of arguing from universal to particular ensures the necessity of the conclusion, but the reverse is not guaranteed. For partially valid conclusions, we cannot definitively say that they hold true for the whole. In some examples, the process of arguing from particular to universal leads to clearly erroneous conclusions. “Some women are mothers” is an absolutely correct proposition, but this premise does not support the conclusion “All women are mothers.”

Highlightg(yellow) - 03 From Particular to Universal > Page 51 · Location 577 Just because certain characteristics are suitable for a part of the whole, it is not necessarily true that these characteristics are suitable for the whole. This is a clear fallacy. However, people often cannot avoid this fallacy, so when facing such situations, one should be extra careful. Hasty generalization is a kind of human nature, although it is not a good thing.

Highlightg(yellow) - 04 Assertion > Page 51 · Location 582 Assertion is the process of linking concepts by attaching a predicate to a subject.

Highlightg(yellow) - 04 Assertion > Page 52 · Location 583 If assertion is the process of aggregating and pairing concepts, then testing the correctness of the assertion lies in whether the aggregated concepts actually fit together in reality.

Highlightg(yellow) - 06 Comparison > Page 54 · Location 623 When we compare two things, we find that they are either completely similar, completely different, or partially similar.

Highlightg(yellow) - 07 Comparison and Argumentation > Page 57 · Location 657 Argument Summary: A possesses characteristics R, S, T, U, V, W, X, and Y. B possesses characteristics R, S, T, U, V, W, X, and Y. A possesses characteristic Z. Therefore, B also possesses characteristic Z. Analyzing this conclusion is not necessary, but it is highly probable. Based on the fact that two things possess many common characteristics, when one of them possesses another characteristic, it is very likely that the other one possesses it as well. Analogical argumentation is only applicable when we cannot directly prove that B possesses characteristic Z—of course, it can also be when B has not yet occurred, so it cannot be analyzed.

Highlightg(yellow) - 08 Correct Argumentation > Page 58 · Location 669 To make an argument correct and powerful, we must pay attention to its facts (content) and its form (structure).

Highlightg(yellow) - 08 Correct Argumentation > Page 58 · Location 679 Conjunctive Argumentation: The symbolic representation of conjunctive argumentation is: A $\cdot$ B. Here, A and B both represent a complete proposition. Using a simple example, for instance: “Anna is a sophomore at the University of Minnesota, majoring in Biology.” The symbol “$\cdot$” between A and B means “and,” and it is important because it signifies that both A and B are true. This is actually a chain reaction: if you assume one is false, you cannot assume the other is true. A $\cdot$ B can serve as a premise for an argument, from which two valid conclusions can be drawn: A $\cdot$ B $\rightarrow$ A $\rightarrow$ B. The contrapositive of A (not A) $\rightarrow$ B (not B) (i.e., Anna is not a sophomore at the University of Minnesota or she does not major in Biology) is also false, because it contradicts the premise of the argument.

Highlightg(yellow) - 10 Syllogism > Page 64 · Location 753 The basis of syllogistic reasoning is first determining that a certain part belongs to a whole, and then concluding that the members of that part also belong to the whole.

Highlightg(yellow) - 11 Truth of the Premise > Page 65 · Location 763 A syllogism, or any argument, if it is to yield a correct conclusion, must meet two basic requirements: first, it must have correct content, and second, it must have a sound structure.

Highlightg(yellow) - 15 Conclusion Must Reflect the Quantity of the Premise > Page 72 · Location 851 Some teenagers study Spanish. Some chess champions are teenagers. Therefore, some chess champions study Spanish. Analyzing the conclusion, it is not certain. It is possible that some chess players study Spanish. In fact, the probability is high. But this argument cannot prove that it is necessary.

Highlightg(yellow) - 15 Conclusion Must Reflect the Quantity of the Premise > Page 72 · Location 855 Two particular premises cannot yield a definite conclusion.

Highlightg(yellow) - 17 Inductive Argumentation > Page 75 · Location 884 Deductive argumentation yields necessary conclusions, while inductive argumentation can only yield probable conclusions.

Highlightg(yellow) - 17 Inductive Argumentation > Page 75 · Location 887 The basic principle of deductive argumentation is: starting from a proposition we know to be true (the major premise), through meticulous analysis (via the minor premise to the conclusion), we deduce what is implicitly contained within the original proposition.

Highlightg(yellow) - 18 Evaluating Argumentation > Page 77 · Location 915 In the process of evaluating the correctness of an argument, the first step is to determine whether the argument being evaluated is a genuine argument.

Chapter 4: Roots of Non-Logical Thinking

Highlightg(yellow) - 01 Skepticism > Page 83 · Location 956 Logic is not satisfied with mere assertion. It pays no heed to the views of authorities, the prejudices of the masses, or the superstitions of the dead.

Highlightg(yellow) - 01 Skepticism > Page 83 · Location 965 The extreme skeptic claims that there is no such thing as truth in the world. This is clearly a self-contradictory conclusion, because if there is no truth in the world, then no proposition can be judged, making this conclusion baseless. The moderate skeptic reluctantly admits that truth might exist in the world, but insists that even if truth exists, humanity lacks the ability to discover it. At first glance, compared to the extreme skeptic, this conclusion seems to give truth a place, but in reality, it does not. If truth exists only theoretically and cannot be verified through practice, then it does not truly exist.

Highlightg(yellow) - 02 Evidential Agnosticism > Page 84 · Location 974 The agnostic neither denies the existence of truth nor considers it unattainable. They merely claim that people know very little about the truth of any definite thing.

Highlightg(yellow) - 05 Emotion and Argumentation > Page 86 · Location 1003 The more intense the emotion, the greater the difficulty in clear thinking and calm action.

Highlightg(yellow) - 05 Emotion and Argumentation > Page 87 · Location 1012 Never directly manipulate people’s emotions; strive to let people discover the truth themselves. Only truth is worth cheering for.

Highlightg(yellow) - 08 The Limits of Sincerity > Page 88 · Location 1026 Sincerity is a necessary condition for correct reasoning, but it is not a sufficient condition. If you do not believe in the view that you publicly advocate and vigorously defend, then you are abusing reasoning.

Chapter 5: Main Forms of Non-Logical Thinking

Highlightg(yellow) - 05 Begging the Question > Page 97 · Location 1111 Treating the view that needs to be proven as a self-evident premise.

Highlightg(yellow) - 05 Begging the Question > Page 98 · Location 1120 Its correctness is predicated on the correctness of the conclusion. If I don’t already know that Jim shaved, then I cannot be certain that everyone by the table has shaved. Therefore, the conclusion merely states a fact we already know. There is no true inference here.

Highlightg(yellow) - 06 False Assumption > Page 99 · Location 1132 A basic standard for judging an assumption is that the proposition must not violate the Law of Contradiction. In other words, it must not contradict itself.

Highlightg(yellow) - 07 Straw Man Fallacy > Page 100 · Location 1141 The Straw Man Fallacy is not an unintentional mistake because it involves deliberately distorting someone else’s argument.

Highlightg(yellow) - 08 Appeal to Tradition > Page 100 · Location 1145 Habit has a major influence on our lives. If we follow habits without analyzing whether they are actually worth following, we become slaves to habit.

Highlightg(yellow) - 09 Appeal to Force (Ad Baculum) > Page 101 · Location 1154 Precedent independently determines future behavior. In reality, precedent cannot provide effective support for future behavior; a completed action only has historical significance.

Highlightg(yellow) - 10 Appeal to Popularity (Ad Populum) > Page 102 · Location 1161 The Appeal to Popularity fallacy states that if the majority of people believe proposition X is correct, then we can conclude that X is correct.

Highlightg(yellow) - 11 Appeal to Person (Ad Hominem) > Page 102 · Location 1166 Principle: In an argument, we must focus on the argument itself, not on the person making the argument.

Highlightg(yellow) - 12 Appeal to Authority > Page 103 · Location 1176 People can only accept what is true when they are thinking freely, and they can only determine what is true when they are judging independently. Bookmark - 13 Abuse of Expert Opinion > Page 103 · Location 1178

Highlightg(yellow) - 13 Abuse of Expert Opinion > Page 103 · Location 1178 Abuse of Expert Opinion: An expert is an authority in a specific field. In an argument, consulting experts in the relevant field is a reasonable practice. However, when consulting experts, one must remain vigilant. Consider the following argument: Professor Smith says Project A is good. Professor Jones says Project A is good. Professor John says Project A is good. Therefore, we should accept Project A. Bookmark - 14 Quantification > Page 105 · Location 1194

Highlightg(yellow) - 16 Stopping at Analysis > Page 107 · Location 1218 The purpose of analysis is not simply to know what parts a thing is composed of, but to clarify how these components are interconnected and interact to form a whole. In purely quantitative terms, it is the whole being greater than the sum of its parts. If you fully understand the essence of a thing, then assembling the disassembled clock parts will still result in a clock.

Precious Metals

Gold and silver have historically been viewed as hedges against inflation. Their intrinsic value is unaffected by specific monetary systems, and they often maintain or even increase their value during economic instability.

Real Assets

Real assets such as real estate, farmland, and forests can usually preserve value, and even appreciate during periods of hyperinflation. These types of assets not only have practical uses but can also generate rent or agricultural income.

Foreign Exchange

Holding relatively stable foreign currencies, such as the US Dollar, Swiss Franc, or other trusted international currencies, can defend against the depreciation of the domestic currency.

Cryptocurrencies

In some cases, cryptocurrencies like Bitcoin are viewed as tools to combat inflation because their supply is limited and not directly affected by government policies. However, the cryptocurrency market is highly volatile, requiring cautious investment.

Inflation-Protected Bonds

In some countries, government-issued inflation-protected bonds (such as TIPS in the US) are linked to inflation indices, providing protection.

Stocks

Stocks in certain industries, such as commodity producers, energy companies, and other businesses related to basic resources, may perform well during inflation because they can pass rising costs on to consumers.

Commodities

Commodities such as oil, natural gas, and grain often see price increases during inflation. Investing in these commodities can hedge against inflation risk.

Collectibles

Collectibles with intrinsic value and relatively independent markets, such as artwork, antiques, and luxury watches, may maintain their value during hyperinflation.

Absurd slogans and constantly altered rules are the main tools Orwell uses to expose how totalitarian regimes manipulate, deceive, and suppress the masses through language. These slogans appear simple and easy to understand on the surface, fitting the interests of the animals, but in reality, they are cleverly twisted and utilized by the rulers (the pigs), ultimately betraying the original intention of the revolution and plunging the other animals back into a state of oppression and exploitation.

Four legs good, two legs bad

Absurdity: This was the animals’ original slogan, used to distinguish themselves (representing the proletariat and revolutionaries) from humans (representing the exploiters and rulers). This slogan emphasizes that all four-legged animals (as well as the two wings of birds) are superior to two-legged creatures (i.e., humans). However, as the pigs’ power gradually increased, they eventually learned to walk upright, and the slogan changed accordingly (see next). Function: This simple and easy-to-remember slogan helped the animals unite against humans, but at the same time, it overly simplified the real issues, failing to recognize the complex hierarchies and changing class struggles among the animals.

Four legs good, two legs better

Absurdity: When the pigs slowly imitated humans and gained more privileges after the revolution, they quietly changed the slogan to “Four legs good, two legs better,” betraying the original intention of the revolution. This change in the slogan reveals the process of power corruption; the pigs gradually became indistinguishable from the enemy they initially overthrew (humans). Function: This new slogan symbolizes the pigs’ complete domination of the farm and betrayal of the other animals. By changing language and rules, they confuse the facts of the other animals, gradually leading them to accept the pigs’ new rule.

All animals are equal, but some animals are more equal than others

Absurdity: This is one of the most famous absurd slogans from Animal Farm. It originally came from the first of the Seven Commandments of Animalism, “All animals are equal,” but as the pigs’ power grew, they changed the slogan to “Some animals are more equal than others.” This sentence is clearly self-contradictory because equality itself implies no difference, but the phrase “more equal” reveals the unfairness in reality. Function: This slogan reflects that the rulers (the pigs) established a new class system by disguising equality. Through this linguistic manipulation, they make the other animals accept their subordinate status, while the pigs enjoy privileges.

Comrade Napoleon is always right

Absurdity: Napoleon is the leader among the pigs, gradually becoming a dictator. This slogan implies that any action taken by Napoleon is flawless and absolutely correct, beyond question. It is a typical totalitarian strategy, asserting the infallibility of the leader, thereby suppressing any dissent or criticism. Function: This slogan, by promoting the absolute authority of the leader, eliminates the space for opposition and questioning, causing the other animals to blindly follow the leader, regardless of how absurd or selfish their decisions may be.

Work harder, Comrade Napoleon is right

Absurdity: This slogan is often repeated by a horse named “Boxer.” He believes that problems will eventually be solved by working harder, and that Napoleon is always right. This blind loyalty and self-sacrifice reflect the trust of the common laborers (symbolizing the working class) in the ruling class, even when the ruling class is constantly exploiting them. Function: By promoting the values of labor and sacrifice, the rulers use this slogan to make the other animals work tirelessly without questioning the distribution of power or the injustice of the system.

Don’t believe what you see, don’t believe what you hear

Absurdity: This phrase is used by Napoleon’s propagandist, “Squealer,” to tell the animals not to believe the facts they see with their own eyes, especially when those facts contradict the party’s propaganda. This is similar to the “doublethink” described by Orwell in 1984, which requires people to ignore reality and accept the false explanation provided by the rulers. Function: This slogan aims to distort the animals’ perception of reality, preventing them from questioning the pigs’ actions or decisions. This is a typical method used by totalitarian regimes to maintain their power by manipulating information and propaganda.

You are the only one who knows what’s most important to you. Remember that: What is important to YOU? Not what is important to the Joneses next door.

Personally, I believe that this market rally is unlikely to be a flash in the pan; rather, it is a mid-term process that could last for two or three months.

What Exactly Happened in Today’s Market?

Today, the three major A-share indices opened and rose collectively. The Shanghai Composite Index closed up 8.06%, standing above 3300 points; the Shenzhen Component Index rose 10.67%; and the ChiNext Index surged 15.36%. Furthermore, the Northern Securities 50 and STAR 50 indices rose 22.84% and 17.88% respectively, both setting new records for the largest single-day gains. Total trading volume reached 259.3 billion yuan, an increase of over 114.7 billion yuan compared to the previous trading day. Despite a net outflow of 51.7 billion yuan in capital from the overall market, the market displayed a broad-based upward trend—5,336 stocks rose, while only 8 fell, and 713 stocks hit the upper limit, with 2 hitting the lower limit.

The Human Condition in the Market

Throughout the day, I observed the reactions of various market participants, showing a significant polarization between veteran and novice investors.

Many veteran investors remain in a wait-and-see attitude, and few are actively trading. Those who are trading often hold small positions. Their mindset is that this wave of gains is unsustainable, and a sharp crash could happen tomorrow. Therefore, their trading style is quick entry and quick exit—they aim to grab a quick profit and leave.

In contrast, new investors who are experiencing such a massive surge for the first time are generally optimistic, even blindly so. They lack risk awareness; continuous profits make them euphoric, leading them to believe they can make a huge fortune and exit the market unscathed.

Why Is the Market So Frenzied?

First, it must be said that this is the largest single-day gain I have witnessed. The various online groups today have been incredibly lively, with both bulls and bears being highly active. People’s attention toward the stock market has reached a new height. Since the Central Bank announced its personal intervention to purchase financial assets on September 24th:

• Capital Inflow: A large amount of capital, lacking investment targets, poured into the A-share market, directly driving up the market.
• Short Covering: As the market rose at an extremely rapid pace, a large number of short sellers utilizing margin lending were forced to liquidate (covered), further propelling the market upward.
• New Blood: The market has gone 8 years without a period of prosperity, and a new generation of young investors who have never experienced such a boom is now entering the arena.

How Is This Market Rally Different from Previous Ones?

Unlike in the past, I believe this rally has distinct differences from previous cycles:

• Direct Central Bank Intervention: This time, the Central Bank is not merely guiding policy; it is personally purchasing financial assets and establishing two structural monetary policy tools: the swap facility for securities, funds, and insurance companies, as well as stock repurchase and increased lending facilities. This scale of capital injection is unprecedented.

• Clear Policy Direction: This rally is not simply a case of “cutting leeks” (harvesting small investors); it is aimed at driving the prosperity of financial assets, which in turn pushes sectors like real estate, thereby alleviating downward economic pressure. This goal clearly requires a medium-to-long-term market rise, not just short-term volatility.

What Will the Future Trend Be?

Due to the statutory holiday, the market will be closed for 7 days starting tomorrow. After the holiday, the market may first experience a wave of correction, as many people hope to realize their paper profits. This is human nature—people prefer certain returns and crave the security of having profits “in the bag.”

However, they will find that after this short-term pullback, the market will advance further, driven by the goals of this rally. Those who exited early, having profited, will be distressed by the market’s continuous ascent, having cut off their own gains. Consequently, some will re-enter the market, and they will do so with even larger amounts of capital (just as Newton, the founder of physics, did during the stock market bubble).

Next, the market will enter a state of artificial prosperity. But this prosperity cannot last indefinitely.

• First, the fundamental economic conditions have not improved, nor have personal incomes. Although those holding financial assets have gained returns, the economy of the vast majority of people remains precarious.
• Second, real estate faces immense inventory pressure. With only 8 million newborns this year, real estate cannot truly secure demand.

Ultimately, the artificial prosperity built upon this strong stimulus will gradually cool down.

Conclusion

Behind today’s massive surge in the A-share market, the Central Bank’s direct intervention is undoubtedly the key driving factor, and the varied reactions of different market groups have further amplified the market’s volatility. Although this rally brings significant market prosperity in the short term, from a macroeconomic and structural perspective, this prosperity carries considerable uncertainty. The market may experience a pullback after the holiday, followed by continued ascent driven by policy, potentially entering a state of artificial prosperity. However, the pressure from the economic fundamentals and the real estate market will eventually cause the market heat to cool down.

Motives Behind the Economic Stimulus

Why launch a new round of stimulus policy at this time? I believe the main reason is that the economic situation is continuously deteriorating. The 5% GDP growth target may be difficult to achieve this year, and the government’s action seems to be a last-ditch effort.

As a large amount of capital enters the stock market, the market may indeed welcome a wave of upward momentum. The overall capital volume of the current A-share market is not large, so this massive injection of funds can certainly push up the stock market in the short term. However, how long this momentum can be maintained depends on the strength of subsequent policies and the determination of the decision-makers.

Long-Term Economic Fundamentals Still Face Challenges

Although the stock market may rise in the short term, from a long-term perspective, the economic fundamentals have not fundamentally changed, and specific problems still exist:

• Corporate profit margins are continuously declining
• The unemployment rate has not shown significant improvement
• The myth of the real estate market “only rising and never falling” has been shattered
• Highly indebted homeowners are not very interested in further leveraging

From an economic perspective, when an economy faces recession, cutting interest rates is usually seen as an effective means of stimulating market vitality and promoting economic growth. However, the effectiveness of interest rate cuts depends on whether businesses and individuals are willing to borrow at low interest rates and invest. When corporate profits are thin and individuals face the risk of unemployment, even if borrowing costs decrease, few people are willing to increase debt—this is what is known as a “balance sheet recession.”

Shift in Consumption and Investment Expectations

Currently, signs of stagnation have appeared, mainly reflected in the change in people’s expectations for the future. Many people no longer expect promotions and salary increases, and this change in expectation has directly led to a contraction in consumption and investment.

Real estate, as the core pillar of the Chinese economy, I believe this round of stimulus will find it difficult to restart its growth. The reason is that market expectations have undergone a profound shift, and the bursting of the bubble has become a reality.

Changes in the Real Estate Market

In the past, people were willing to leverage and buy homes by pooling resources from “six wallets,” not because housing was an absolute necessity. Aside from basic living needs, almost nothing is an absolute necessity. At that time, housing had a strong financial attribute. People generally believed that housing prices would continue to rise, and investing in real estate could bring generous returns. Therefore, they believed that buying a home was not just avoiding debt, but rather a guaranteed profit investment. From historical data, the national average housing price rose from 500 yuan per square meter to 20,000 yuan, and past investments have indeed yielded returns. However, the current market logic has fundamentally changed.

Conclusion

In summary, I believe the effect of this round of economic stimulus policy will be very limited. The real estate market will remain sluggish, and after experiencing a brief frenzy, the stock market may quickly return to calm, with the index possibly falling below 3,000 again. The long-term economic challenges still exist, and this stimulus may struggle to fundamentally reverse the situation.

• “If you reach for a star, you might not get one. But you won’t come up with a hand full of mud either.”

• Spend less than you earn—invest the surplus—avoid debt.

• Carrying debt is as appealing as being covered with leeches and has much the same effect.

• If your lifestyle matches—or god forbid exceeds—your income, you are no more than a gilded slave.

• Avoid investment advisors. Too many have only their own interests at heart. By the time you know enough to pick a good one, you know enough to handle your finances yourself. It’s your money and no one will care for it better than you.

• Money can buy many things, but nothing more valuable than your freedom.

• Life choices are not always about the money, but you should always be clear about the financial impact of the choices you make.

• Try saving and investing 50% of your income. With no debt, this is perfectly doable.

• The stock market is a powerful wealth-building tool and you should be investing in it. But realize the market and the value of your shares will sometimes drop dramatically. This is absolutely normal and to be expected. When it happens, ignore the drops and buy more shares.

• 股市暴跌是必然的,高度确定的.就像天会下雨一样,不可避免的,那是你买入的机会

• This will be much, much harder than you think. People all around you will panic. The news media will be screaming Sell, Sell, Sell!

• When you can live on 4% of your investments per year, you are financially independent.

• “You know, if you could learn to cater to the king, you wouldn’t have to live on rice and beans.” To which the monk replies: “If you could learn to live on rice and beans, you wouldn’t have to cater to the king.”

Part I: Orientation

• If you intend to achieve financial freedom, you are going to have to think differently. It starts by recognizing that debt should not be considered normal. It should be recognized as the vicious, pernicious destroyer of wealth-building potential it truly is. It has no place in your financial life.

• Your lifestyle is diminished. Set aside any aspirations to financial freedom. Even if your goal is living the maximum consumer lifestyle, the more debt you carry the more of your income is devoured by interest payments. A (sometimes huge) portion of your income has already been spent.

• You are enslaved to whatever source of income you have. Your debt needs to be serviced. Your practical ability to make choices congruent with your values and long-term goals is seriously constrained. Your stress levels build. It feels as if you are being buried alive. The emotional and psychological effects of being saddled with debt are real and dangerous. You endure the same type of negative emotions experienced by any addict: shame, guilt, loneliness, and above all, helplessness. The fact that it’s a prison of your own making makes it all the more difficult. Your options can become so narrowed and your stress levels so high, you risk turning to self-destructive patterns that only reinforce the dependence on spending. Drinking perhaps, or smoking. Or, ironically, shopping and still more spending. It’s a dangerous, self-perpetuating cycle. Your debt tends to focus your attention on the past, present and future exclusively in the worst possible way. You become fixated on your past mistakes, your present pain and the disaster looming ahead. Your brain tends to shut down on the subject with the vague hope it will all resolve itself in some magical way and in the magical time of later. Living with debt becomes hardwired in your financial attitudes, habits and values.

• If your interest rate is… Less than 3%, pay it off slowly and route the money to your investments instead. Between 3-5%, do whatever feels most comfortable: Either put the money to debt payment or investments. More than 5%, pay it off ASAP.

• If your goal is financial independence, it is also to hold as little debt as possible. This means you’ll seek the least house to meet your needs rather than the most house you can technically afford.

• More house also means more stuff to maintain and fill it. The more and greater things you allow in your life, the more of your time, money and life energy they demand.

• Houses are an expensive indulgence, not an investment. That’s OK if and when the time for such an indulgence comes. I’ve owned them myself. But don’t let yourself be blinded by the idea that owning one is necessary, always financially sound and automatically justifies taking on this “good debt.”

• Money is a very relative thing.

• Money can buy many things, none of which is more important than your financial independence.

• Stop thinking about what your money can buy. Start thinking about what your money can earn. And then think about what the money it earns can earn.

• Warren Buffett is rather famously quoted as saying: Rule #1: Never lose money. Rule #2: Never forget rule #1. Unfortunately, too many people take this at face value and leap to the conclusion that Mr. Buffett has found a magical way to dance in and out of the market, avoiding the inevitable drops. This is not true and in fact he is on record speaking to the folly of trying: “The Dow started the last century at 66 and ended at 11,400. How could you lose money during a period like that? A lot of people did because they tried to dance in and out.”

• Like the rest of us, Buffett was unable to time the market and in fact, knowing market timing to be a fool’s errand, he didn’t even try. But unlike many others, Buffett didn’t panic and sell. He knew that such events are to be expected. In fact, he continued to invest as the sharp decline offered new opportunities. When the market recovered, as it always does, so did his fortune. So did the fortunes of all who stayed the course. That’s why I put “lost” in quotes.

• At $ 56 per share or at $ 52 per share, you still own the same 186.3238308 shares of VTSAX. That in turns means you own a piece of virtually every publicly traded company in the U.S.—

• Once you truly understand this, you’ll begin to realize that in owning VTSAX you are tying your financial future to that same large, diverse group of companies based in the most powerful, wealthiest and most influential country on the planet. These companies are filled with hardworking people focused on prospering in the changing world around them and dealing with all the uncertainties it can create.

• 你拥有的是公司的一部分，拥有了全世界最聪明的大脑帮你工作。你是他们的老板。

• It is simply not possible to time the market, regardless of all the heavily credentialed gurus on CNBC and the like who claim they can. The market is the most powerful wealth-building tool of all time. The market always goes up and it is always a wild and rocky ride along the way. Since we can’t predict these swings, we need to toughen up mentally and ride them out. I want my money working as hard as possible, as soon as possible.

• Fear is perfectly understandable. Nobody wants to lose money. But until you master it, such fear will be deadly to your wealth. It will prevent you from investing. Once you are invested, it will cause you to flee in panic for the exits every time the market drops. And drop—repeatedly on its relentless march upward—it will. The curse of fear is that it will drive you to panic and sell when you should be holding. The market is volatile. Crashes, pullbacks and corrections are all absolutely normal. None of them are the end of the world, and none are even the end of the market’s relentless rise. They are all, each and every one, expected parts of the process.

• Any investing done short term is by definition speculation.

• 任何短期行为都是投机

• Therefore, if we know a crash is coming, why not wait to invest? Or, if currently invested why not sell, wait till the fall and then go back in? The answer is simply because we don’t know when the crash will occur or end. Nobody does.

Part II: How to harness the world’s most powerful wealth-building tool

• “Simplicity is the keynote of all true elegance.”

• “Those who would trade liberty for security deserve neither.”

• The market always recovers. Always. And, if someday it really doesn’t, no investment will be safe and none of this financial stuff will matter anyway.

• 世界崩坏,找个墓地吧

• The market always goes up. Always.

• 区别在于是不是当权者拿走你那份

• The market is the single best performing investment class over time, bar none.

• The next 10, 20, 30, 40, 50 years will have just as many collapses, recessions and disasters as in the past. Like the good Professor says, it’s not possible to prevent them. Every time this happens your investments will take a hit. Every time it will be scary as hell. Every time all the smart guys will be screaming: Sell!! And every time only those few with enough nerve will stay the course and prosper.

• 6. This is why you have to toughen up, learn to ignore the noise and ride out the storm; adding still more money to your investments as you go.
• 7. To be strong enough to stay the course you need to know these bad things are coming—not only intellectually but on an emotional level as well. You need to know this deep in your gut. They will happen. They will hurt. But like blizzards in winter they should never be a surprise. And, unless you panic, they won’t matter.
• 8. There’s a major market crash coming!! And there’ll be another after that!! What wonderful buying opportunities they’ll be.

• Of course, over those same years she’s going to see several major bull markets as well. Some will rage beyond all reason, along with the hype that will surround them. When those occur, the financial media will declare “this time it’s different” with all the same confidence as when they claimed the end had come. In this too they will be wrong.

• Through disaster after disaster the market always makes its way higher over time. It’s a wild ride along the way. There is a Big, Ugly Event.

• 1. The market is self-cleansing.
• 2. Owning stock is owning a part of living, breathing, dynamic companies, each striving to succeed.

• Stocks are not just little slips of traded paper. When you own stock you own a piece of a business. These are companies filled with people working endlessly to expand and serve their customer base. They are competing in an unforgiving environment that rewards those who can make it happen and discards those who can’t. It is this intense dynamic that makes stocks and the companies they represent the most powerful and successful investment class in history.

• Why most people lose money in the market

• Most people lose money in the stock market.

• 1. We think we can time the market.
• 2. We believe we can pick individual stocks.
• 3. We believe we can pick winning mutual fund managers.
• 4. We focus on the foam.

• It is the beer: The actual operating businesses of which we can own a part. It is the foam: The traded pieces of paper that furiously rise and fall in price from moment-to-moment. This is the market of CNBC.

• The good news for our VTSAX wealth-building strategy (which we’ll discuss in depth in the next few chapters) is that stocks are a pretty good inflation hedge. As we’ve discussed, in owning stocks we own businesses. These businesses have assets and create products. The value of those rise with inflation, providing a hedge against the falling value of the currency. This is especially true in times of low to moderate inflation.

• In what stage of your investing life are you? The Wealth Accumulation Stage or the Wealth Preservation Stage? Or perhaps a blend of the two? What level of risk do you find acceptable? Is your investment horizon long-term or short-term?

• Safety is a bit of an illusion.

• 2. To buy the index is to accept the market’s “average” return. People have trouble accepting the idea of themselves or anything in their life as average.

• Bonds pay interest, providing us with an income flow.

• When you buy stock you are buying a part ownership in a company. When you buy bonds you are loaning money to a company or government agency.

• Since deflation occurs when the price of stuff falls, when the money you’ve lent is paid back, it has more purchasing power. Your money buys more stuff than when you lent it. This increase in value helps to offset the losses deflation will bring to your other assets. In times of inflation prices rise and so money owed to you loses value. When you get paid back your cash buys less stuff. Then it is better to own assets, like stocks, that rise in value with inflation.

• The two key elements of bonds are the interest rate and the term.

• 流动性与收益率

• When interest rates rise, bond prices fall. When interest rates fall, bond prices rise. In either case, if you hold a bond to the end of its term you will, barring default, get exactly what you paid for it.

• when we get an Inverted Yield Curve and short-term rates are higher than long-term rates, investors are anticipating low inflation or even deflation.

• Put all your eggs in one basket and forget about it.

• The great irony of investing is that the more you watch and fiddle with your holdings the less well you are likely to do. Fill your basket, add as much as you can along the way and ignore it the rest of the time. You’ll likely wake up rich.

• Owning 100% stocks like this is considered a very aggressive investment allocation. It is aggressive and in this Wealth Accumulation Phase, you should be. You have decades ahead and you’ll be adding new money as you go. Market ups and downs don’t matter because you’ll avoid panic and stay the course. If anything, you recognize drops as the “stocks on sale” buying opportunities they are. Perhaps 40 years from now (or whenever you are living on your portfolio) you might want to add a bond index fund to smooth the ride. Worry about that then.

• You can’t predict them and you can’t time them.

• If you look at all asset classes from bonds to real estate to gold to farmland to art to racehorses to whatever, stocks provide the best performance over time. Nothing else even comes close.

• Stocks are not just little slips of traded paper. When you own stock you own a piece of a business. Many of these have extensive international operations, allowing you to participate in all the markets across the globe.

• Because VTSAX is an index fund, we don’t even have to worry about which companies will succeed and which will fail. As we’ve seen, it is ‘self-cleansing.’ The failures fall away and the winners can grow endlessly.

• Put all your eggs into one large and diverse basket, add more whenever you can and forget about it. The more you add the faster you’ll get there. Job done.

• ~ 75% Stocks: VTSAX (Vanguard Total Stock Market Index Fund). Still our core holding for all the reasons we’ve discussed. ~ 20% Bonds: VBTLX (Vanguard Total Bond Market Index Fund). Bonds provide some income, tend to smooth out the rough ride of stocks and are a deflation hedge. ~ 5% Cash: We hold ours in our local bank.

• Life is balance and choice. Add more of this, lose a little of that.

• The wealth accumulation stage is when you are working and have earned income to save and invest. For this stage I favor 100% stocks and VTSAX is the fund I prefer. If financial independence is your goal, your savings rate in these years should be high. As you invest that money each month it serves to smooth out the market’s wild ride. You enter the wealth preservation stage once you step away from your job and regular paychecks and begin living on income from your investments. At this point, I recommend adding bonds to the portfolio. Like the fresh cash you were investing while working, bonds help smooth the ride.

• Managing other people’s money is a very big business, and for those who engage in it, a very lucrative one.

Part III: Magic Beans

• Buffett writes: “My advice … could not be more simple: Put 10% of the cash in short-term government bonds and 90% in a very low-cost S& P 500 index fund. (I suggest Vanguard’s.) I believe the trust’s long-term results from this policy will be superior to those attained by most investors–whether pension funds, institutions or individuals–who employ high-fee managers.”

• My advice: Use the index funds and the company Mr. Bogle created and keep what is yours.

• At this point you are probably beginning to see why I’m not a DCA fan, but let’s list the reasons anyway: By dollar cost averaging you are betting that the market will drop, saving yourself some pain. For any given year the odds of this happening are only ~ 23%. But the market is about 77% more likely to rise, in which case you will have spared yourself some gain. With each new invested portion you’ll be paying more for your shares. When you DCA you are basically saying the market is too high to invest all at once. In other words, you have strayed into the murky world of market timing. Which, as we’ve discussed, is a loser’s game. DCAing screws with your asset allocation. In the beginning you will be holding an outsized allocation of cash sitting on the sidelines waiting to be deployed. That’s OK if that’s your allocation strategy. But if not you need to understand that, in choosing to DCA, you’ve changed your allocation in a deep and fundamental way. When choosing to DCA, you must also choose the time horizon. Since the market tends to rise over time, if you choose a long horizon, say over a year, you increase the risk of paying more for your shares while you are investing. If you choose a shorter period of time, you reduce the value of using DCA in the first place. Finally, once you reach the end of your DCA period and are fully invested, you run the same risk of the market plunging the day after you are done.

• Step 1: Make a prediction for a huge short-term swing in the market. Up or down doesn’t matter. But down is easier and scarier. Scarier will get you more play if you’re right. Step 2: Document the time and date you made it. Step 3: When it doesn’t happen, wait a bit. Step 4: Repeat Steps 1-3 until one day you’re right. Step 5: Issue Press Release: Market Plunges!!!, just as (insert your name here) recently predicted. Step 6: Clear your schedule for media interviews. Step 7: Send me my 15% agent’s fee of your new-found wealth. Be sure not to issue your press release until events prove you right.

• Rule #1: Everybody can be conned. Certainly stupid people are marks. But so are the exceptionally bright. The moment you start to think that it can’t happen to you, you’ve become a most attractive target. The easiest victims are those that think they are too smart, too knowledgeable to be taken. This means you, bucko.

• Rule #2: You are likely to be conned in an area of your expertise. The reason is simple: Targeting and ego. When con men pick a scam they look for people to whom it will naturally appeal. Those are people in the field. People feel secure and safe in those areas they know well. They believe they will be too smart to be caught unawares. Smart people know the areas they don’t know and tend to be far more cautious there. Many of Bernie Madoff’s victims were financial professionals.

• Rule #3: Con men (and women) don’t look like con men. This isn’t the movies. They’re not going to have slouch hats pulled low over their shifty eyes. Successful con men look like the safest, most trustworthy, honest, stable, comforting people imaginable. You won’t see them coming. Or rather you will, and you’ll be warmly welcoming them.

• Rule #4: 99% of what they say will be true. The best, most effective lies are surrounded by truth. Buried in it. The con, the thing that will leave you broke and with a real reason to cry, is carefully hidden. It is deep in the proverbial fine print.

• Rule #5: If it looks too good to be true, it is. There is no free lunch. Not ever. Your Mama taught you this. She was right. Listen to your Mama.

Part IV: What to do when you get there

• “Money frees you from doing things you dislike.

• True financial security—and enjoying the full potential of your wealth—can only be found in this flexibility. As the winds change, so will my withdrawals. I suggest the same for you.

• Plan your financial future assuming Social Security will NOT be there for you. Live below your means, invest the surplus, avoid debt and accumulate F-You Money. Be independent, financially and otherwise. If/ when Social Security comes through, enjoy.

You stand by conscience, he stands by the strong— This is a difference in values;

Your effort is for an ideal life, His effort is to be superior to others— This is a difference in philosophy of life.

1: The Surprising Power of Atomic Habits

People make a few small changes, fail to see a tangible result, and decide to stop. You think, “I’ve been running every day for a month, so why can’t I see any change in my body?” Once this kind of thinking takes over, it’s easy to let good habits fall by the wayside. But in order to make a meaningful difference, habits need to persist long enough to break through this plateau—what I call the Plateau of Latent Potential. qPeople make a few small changes, fail to see a tangible result, and decide to stop. You think, “I’ve been running every day for a month, so why can’t I see any change in my body?” Once this kind of thinking takes over, it’s easy to let good habits fall by the wayside. But in order to make a meaningful difference, habits need to persist long enough to break through this plateau—what I call the Plateau of Latent Potential.

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The Difficulty of Forming Good Habits is Mainly Lack of Progress Bars

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If you find yourself struggling to build a good habit or break a bad one, it is not because you have lost your ability to improve. It is often because you have not yet crossed the Plateau of Latent Potential.

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When you finally break through the Plateau of Latent Potential, people will call it an overnight success.

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All big things come from small beginnings. The seed of every habit is a single, tiny decision. But as that decision is repeated, a habit sprouts and grows stronger. Roots entrench themselves and branches grow. The task of breaking a bad habit is like uprooting a powerful oak within us.

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FORGET ABOUT GOALS, FOCUS ON SYSTEMS INSTEAD

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Ignore Goals, Focus on Building Systems

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I began to realize that my results had very little to do with the goals I set and nearly everything to do with the systems I followed.

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Systems are more useful than goals

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Goals are about the results you want to achieve. Systems are about the processes that lead to those results. If you’re a coach, your goal might be to win a championship. Your system is the way you recruit players, manage your assistant coaches, and conduct practice. If you’re an entrepreneur, your goal might be to build a million-dollar business. Your system is how you test product ideas, hire employees, and run marketing campaigns. If you’re a musician, your goal might be to play a new piece. Your system is how often you practice, how you break down and tackle difficult measures, and your method for receiving feedback from your instructor.

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Goals are what you want to achieve; systems are the methodology of how you achieve them

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Now for the interesting question: If you completely ignored your goals and focused only on your system, would you still succeed? For example, if you were a basketball coach and you ignored your goal to win a championship and focused only on what your team does at practice each day, would you still get results?

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Don’t set the goal as “rank in grade,” but as “love of learning”

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Problem #1: Winners and losers have the same goals.

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Goal setting suffers from a serious case of survivorship bias.

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The goal of the runner-up is also the goal of the champion—that is survivorship bias

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Problem #2: Achieving a goal is only a momentary change.

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Imagine you have a messy room and you set a goal to clean it. If you summon the energy to tidy up, then you will have a clean room—for now. But if you maintain the same sloppy, pack-rat habits that led to a messy room in the first place, soon you’ll be looking at a new pile of clutter and hoping for another burst of motivation. You’re left chasing the same outcome because you never changed the system behind it. You treated a symptom without addressing the cause.

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Tidying the room is a goal; loving cleanliness is an identity

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When you solve problems at the results level, you only solve them temporarily. In order to improve for good, you need to solve problems at the systems level. Fix the inputs and the outputs will fix themselves.

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Problem #3: Goals restrict your happiness.

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Goals reduce happiness; how can you be happy if you don’t achieve the goal?

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The implicit assumption behind any goal is this: “Once I reach my goal, then I’ll be happy.” The problem with a goals-first mentality is that you’re continually putting happiness off until the next milestone.

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A systems-first mentality provides the antidote. When you fall in love with the process rather than the product, you don’t have to wait to give yourself permission to be happy. You can be satisfied anytime your system is running. And a system can be successful in many different forms, not just the one you first envision.

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Problem #4: Goals are at odds with long-term progress.

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The Yo-Yo Effect

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Finally, a goal-oriented mind-set can create a “yo-yo” effect. Many runners work hard for months, but as soon as they cross the finish line, they stop training. The race is no longer there to motivate them. When all of your hard work is focused on a particular goal, what is left to push you forward after you achieve it? This is why many people find themselves reverting to their old habits after accomplishing a goal.

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The purpose of setting goals is to win the game. The purpose of building systems is to continue playing the game.

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Focusing on the overall system, rather than a single goal, is one of the core themes of this book.

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Habits are the compound interest of self-improvement. Getting 1 percent better every day counts for a lot in the long-run. Habits are a double-edged sword. They can work for you or against you, which is why understanding the details is essential. Small changes often appear to make no difference until you cross a critical threshold. The most powerful outcomes of any compounding process are delayed. You need to be patient. An atomic habit is a little habit that is part of a larger system. Just as atoms are the building blocks of molecules, atomic habits are the building blocks of remarkable results. If you want better results, then forget about setting goals. Focus on your system instead. You do not rise to the level of your goals. You fall to the level of your systems.

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It often feels difficult to keep good habits going for more than a few days, even with sincere effort and the occasional burst of motivation. Habits like exercise, meditation, journaling, and cooking are reasonable for a day or two and then become a hassle. However, once your habits are established, they seem to stick around forever—especially the unwanted ones.

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Changing our habits is challenging for two reasons: (1) we try to change the wrong thing and (2) we try to change our habits in the wrong way.

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THREE LAYERS OF BEHAVIOR CHANGE

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The first layer is changing your outcomes. This level is concerned with changing your results: losing weight, publishing a book, winning a championship. Most of the goals you set are associated with this level of change. The second layer is changing your process. This level is concerned with changing your habits and systems: implementing a new routine at the gym, decluttering your desk for better workflow, developing a meditation practice. Most of the habits you build are associated with this level. The third and deepest layer is changing your identity. This level is concerned with changing your beliefs: your worldview, your self-image, your judgments about yourself and others. Most of the beliefs, assumptions, and biases you hold are associated with this level.

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Outcomes are about what you get. Processes are about what you do. Identity is about what you believe.

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Many people begin the process of changing their habits by focusing on what they want to achieve. This leads us to outcome-based habits. The alternative is to build identity-based habits. With this approach, we start by focusing on who we wish to become.

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Goals are not single achievements, but who you become

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Imagine two people resisting a cigarette. When offered a smoke, the first person says, “No thanks. I’m trying to quit.” It sounds like a reasonable response, but this person still believes they are a smoker who is trying to be something else. They are hoping their behavior will change while carrying around the same beliefs. The second person declines by saying, “No thanks. I’m not a smoker.” It’s a small difference, but this statement signals a shift in identity.

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Most people don’t even consider identity change when they set out to improve. They just think, “I want to be skinny (outcome) and if I stick to this diet, then I’ll be skinny (process).” They set goals and determine the actions they should take to achieve those goals without considering the beliefs that drive their actions. They never shift the way they look at themselves, and they don’t realize that their old identity can sabotage their new plans for change.

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Behavior that is incongruent with the self will not last.

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It’s hard to change your habits if you never change the underlying beliefs that led to your past behavior. You have a new goal and a new plan, but you haven’t changed who you are.

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The ultimate form of intrinsic motivation is when a habit becomes part of your identity. It’s one thing to say I’m the type of person who wants this. It’s something very different to say I’m the type of person who is this.

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Good Labels

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True behavior change is identity change.

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The goal is not to read a book, the goal is to become a reader. The goal is not to run a marathon, the goal is to become a runner. The goal is not to learn an instrument, the goal is to become a musician.

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Identity determines behavior

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Your behaviors are usually a reflection of your identity.

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Doing the right thing is easy. After all, when your behavior and your identity are fully aligned, you are no longer pursuing behavior change. You are simply acting like the type of person you already believe yourself to be.

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On any given day, you may struggle with your habits because you’re too busy or too tired or too overwhelmed or hundreds of other reasons. Over the long run, however, the real reason you fail to stick with habits is that your self-image gets in the way. This is why you can’t get too attached to one version of your identity. Progress requires unlearning. Becoming the best version of yourself requires you to continuously edit your beliefs, and to upgrade and expand your identity.

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Abandon the old version of you, continuously iterate

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THE TWO-STEP PROCESS TO CHANGING YOUR IDENTITY

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Your identity emerges out of your habits. You are not born with preset beliefs. Every belief, including those about yourself, is learned and conditioned through experience.*

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More precisely, your habits are how you embody your identity. When you make your bed each day, you embody the identity of an organized person. When you write each day, you embody the identity of a creative person. When you train each day, you embody the identity of an athletic person.

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Being a role model means that children also want to become the same person as you (Love learning? Can play on the phone infinitely?)

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Of course, your habits are not the only actions that influence your identity, but by virtue of their frequency they are usually the most important ones. Each experience in life modifies your self-image, but it’s unlikely you would consider yourself a soccer player because you kicked a ball once or an artist because you scribbled a picture. As you repeat these actions, however, the evidence accumulates and your self-image begins to change. The effect of one-off experiences tends to fade away while the effect of habits gets reinforced with time, which means your habits contribute most of the evidence that shapes your identity. In this way, the process of building habits is actually the process of becoming yourself.

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Small habits can make a meaningful difference by providing evidence of a new identity. And if a change is meaningful, it actually is big. That’s the paradox of making small improvements. Putting this all together, you can see that habits are the path to changing your identity. The most practical way to change who you are is to change what you do. Each time you write a page, you are a writer. Each time you practice the violin, you are a musician. Each time you start a workout, you are an athlete. Each time you encourage your employees, you are a leader.

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Each habit not only gets results but also teaches you something far more important: to trust yourself. You start to believe you can actually accomplish these things.

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New identities require new evidence. If you keep casting the same votes you’ve always cast, you’re going to get the same results you’ve always had. If nothing changes, nothing is going to change. It is a simple two-step process: Decide the type of person you want to be. Prove it to yourself with small wins.

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“Who is the type of person that could get the outcome I want?” Who is the type of person that could lose forty pounds? Who is the type of person that could learn a new language? Who is the type of person that could run a successful start-up?

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This process can lead to beliefs like: “I’m the kind of teacher who stands up for her students.” “I’m the kind of doctor who gives each patient the time and empathy they need.” “I’m the kind of manager who advocates for her employees.”

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Once you have a handle on the type of person you want to be, you can begin taking small steps to reinforce your desired identity. I have a friend who lost over 100 pounds by asking herself, “What would a healthy person do?” All day long, she would use this question as a guide. Would a healthy person walk or take a cab? Would a healthy person order a burrito or a salad? She figured if she acted like a healthy person long enough, eventually she would become that person. She was right.

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Fake it until you make it

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THE REAL REASON HABITS MATTER Identity change is the North Star of habit change.

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…you becoming the type of person you want to become?” The first step is not what or how, but who. You need to know who you want to be. Otherwise, your quest for change is like a boat without a rudder. And that’s why we are starting here.

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Ultimately, your habits matter because they help you become the type of person you wish to be. They are the channel through which you develop your deepest beliefs about yourself. Quite literally, you become your habits.

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There are three levels of change: outcome change, process change, and identity change. The most effective way to change your habits is to focus not on what you want to achieve, but on who you wish to become. Your identity emerges out of your habits. Every action is a vote for the type of person you wish to become. Becoming the best version of yourself requires you to continuously edit your beliefs, and to upgrade and expand your identity. The real reason habits matter is not because they can get you better results (although they can do that), but because they can change your beliefs about yourself.

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Habits are mental shortcuts learned from experience.

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Habits reduce cognitive load and free up mental capacity, so you can allocate your attention to other tasks.

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THE SCIENCE OF HOW HABITS WORK The process of building a habit can be divided into four simple steps: cue, craving, response, and reward.*

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All habits proceed through four stages in the same order: cue, craving, response, and reward.

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The cue is the first indication that we’re close to a reward; it naturally leads to a craving. Cravings are the second step, and they are the motivational force behind every habit.

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The third step is the response.

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The first purpose of rewards is to satisfy your craving. Yes, rewards provide benefits on their own. Food and water deliver the energy you need to survive.

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Second, rewards teach us which actions are worth remembering in the future. Your brain is a reward detector. As you go about your life, your sensory nervous system is continuously monitoring which actions satisfy your desires and deliver pleasure.

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The four stages of habit are best described as a feedback loop. They form an endless cycle that is running every moment you are alive. This “habit loop” is continually scanning the environment, predicting what will happen next, trying out different responses, and learning from the results.*

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In summary, the cue triggers a craving, which motivates a response, which provides a reward, which satisfies the craving and, ultimately, becomes associated with the cue.

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All behavior is driven by the desire to solve a problem.

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How to Create a Good Habit The 1st law (Cue): Make it obvious. The 2nd law (Craving): Make it attractive. The 3rd law (Response): Make it easy. The 4th law (Reward): Make it satisfying.

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How to Break a Bad Habit Inversion of the 1st law (Cue): Make it invisible. Inversion of the 2nd law (Craving): Make it unattractive. Inversion of the 3rd law (Response): Make it difficult. Inversion of the 4th law (Reward): Make it unsatisfying.

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Whenever you want to change your behavior, you can simply ask yourself: How can I make it obvious? How can I make it attractive? How can I make it easy? How can I make it satisfying?

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Every goal is doomed to fail if it goes against the grain of human nature.

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Chapter Summary A habit is a behavior that has been repeated enough times to become automatic. The ultimate purpose of habits is to solve the problems of life with as little energy and effort as possible. Any habit can be broken down into a feedback loop that involves four steps: cue, craving, response, and reward. The Four Laws of Behavior Change are a simple set of rules we can use to build better habits. They are (1) make it obvious, (2) make it attractive, (3) make it easy, and (4) make it satisfying.

THE 1ST LAW: Make It Obvious

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With enough practice, you can pick up on the cues that predict certain outcomes without consciously thinking about it. Automatically, your brain encodes the lessons learned through experience. We can’t always explain what it is we are learning, but learning is happening all along the way, and your ability to notice the relevant cues in a given situation is the foundation for every habit you have.

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This is one of the most surprising insights about our habits: you don’t need to be aware of the cue for a habit to begin. You can notice an opportunity and take action without dedicating conscious attention to it. This is what makes habits useful.

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“Until you make the unconscious conscious, it will direct your life and you will call it fate.”

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Pointing-and-Calling is so effective because it raises the level of awareness from a nonconscious habit to a more conscious level.

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The more automatic a behavior becomes, the less likely we are to consciously think about it. And when we’ve done something a thousand times before, we begin to overlook things. We assume that the next time will be just like the last.

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One of our greatest challenges in changing habits is maintaining awareness of what we are actually doing.

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With enough practice, your brain will pick up on the cues that predict certain outcomes without consciously thinking about it. Once our habits become automatic, we stop paying attention to what we are doing. The process of behavior change always starts with awareness. You need to be aware of your habits before you can change them. Pointing-and-Calling raises your level of awareness from a nonconscious habit to a more conscious level by verbalizing your actions. The Habits Scorecard is a simple exercise you can use to become more aware of your behavior.

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“I will partake in at least 20 minutes of vigorous exercise on [DAY] at [TIME] in [PLACE].”

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Too many people try to change their habits without these basic details figured out. We tell ourselves, “I’m going to eat healthier” or “I’m going to write more,” but we never say when and where these habits are going to happen.

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Many people think they lack motivation when what they really lack is clarity.

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Simply follow your predetermined plan. The simple way to apply this strategy to your habits is to fill out this sentence: I will [BEHAVIOR] at [TIME] in [LOCATION]. Meditation. I will meditate for one minute at 7 a.m. in my kitchen. Studying. I will study Spanish for twenty minutes at 6 p.m. in my bedroom. Exercise. I will exercise for one hour at 5 p.m. in my local gym. Marriage. I will make my partner a cup of tea at 8 a.m. in the kitchen.

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HABIT STACKING: A SIMPLE PLAN TO OVERHAUL YOUR HABITS

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The Diderot Effect states that obtaining a new possession often creates a spiral of consumption that leads to additional purchases.

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Diderot Effect

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Each action becomes a cue that triggers the next behavior.

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One of the best ways to build a new habit is to identify a current habit you already do each day and then stack your new behavior on top. This is called habit stacking.

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“After [CURRENT HABIT], I will [NEW HABIT].”

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The key is to tie your desired behavior into something you already do each day.

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The 1st Law of Behavior Change is make it obvious. The two most common cues are time and location. Creating an implementation intention is a strategy you can use to pair a new habit with a specific time and location. The implementation intention formula is: I will [BEHAVIOR] at [TIME] in [LOCATION]. Habit stacking is a strategy you can use to pair a new habit with a current habit. The habit stacking formula is: After [CURRENT HABIT], I will [NEW HABIT].

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Environment is the invisible hand that shapes human behavior.

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If you want to make a habit a big part of your life, make the cue a big part of your environment. The most persistent behaviors usually have multiple cues.

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Habits can be easier to change in a new environment.

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Chapter Summary Small changes in context can lead to large changes in behavior over time. Every habit is initiated by a cue. We are more likely to notice cues that stand out. Make the cues of good habits obvious in your environment. Gradually, your habits become associated not with a single trigger but with the entire context surrounding the behavior. The context becomes the cue. It is easier to build new habits in a new environment because you are not fighting against old cues.

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Shaming obese people with weight-loss presentations can make them feel stressed, and as a result many people return to their favorite coping strategy: overeating. Showing pictures of blackened lungs to smokers leads to higher levels of anxiety, which drives many people to reach for a cigarette. If you’re not careful about cues, you can cause the very behavior you want to stop.

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Bad habits are autocatalytic: the process feeds itself. They foster the feelings they try to numb. You feel bad, so you eat junk food. Because you eat junk food, you feel bad.

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If you can’t seem to get any work done, leave your phone in another room for a few hours. If you’re continually feeling like you’re not enough, stop following social media accounts that trigger jealousy and envy. If you’re wasting too much time watching television, move the TV out of the bedroom. If you’re spending too much money on electronics, quit reading reviews of the latest tech gear. If you’re playing too many video games, unplug the console and put it in a closet after each use.

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Removing Triggers

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Chapter Summary The inversion of the 1st Law of Behavior Change is make it invisible. Once a habit is formed, it is unlikely to be forgotten. People with high self-control tend to spend less time in tempting situations. It’s easier to avoid temptation than resist it. One of the most practical ways to eliminate a bad habit is to reduce exposure to the cue that causes it. Self-control is a short-term strategy, not a long-term one.

THE 2ND LAW: Make It Attractive

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How to Make a Habit Irresistible

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Make it attractive. The more attractive an opportunity is, the more likely it is to become habit-forming.

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If you want to increase the odds that a behavior will occur, then you need to make it attractive. Throughout our discussion of the 2nd Law, our goal is to learn how to make our habits irresistible.

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As an adult, daydreaming about an upcoming vacation can be more enjoyable than actually being on vacation.

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A psychology theory known as Premack’s Principle. Named after the work of professor David Premack, the principle states that “more probable behaviors will reinforce less probable behaviors.” In other words, even if you don’t really want to process overdue work emails, you’ll become conditioned to do it if it means you get to do something you really want to do along the way. You can even combine temptation bundling with the habit stacking strategy we discussed in Chapter 5 to create a set of rules to guide your behavior.

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The habit stacking + temptation bundling formula is: After [CURRENT HABIT], I will [HABIT I NEED]. After [HABIT I NEED], I will [HABIT I WANT].

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If you want to check Facebook, but you need to exercise more: After I pull out my phone, I will do ten burpees (need). After I do ten burpees, I will check Facebook (want).

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Chapter Summary The 2nd Law of Behavior Change is make it attractive. The more attractive an opportunity is, the more likely it is to become habit-forming. Habits are a dopamine-driven feedback loop. When dopamine rises, so does our motivation to act. It is the anticipation of a reward—not the fulfillment of it—that gets us to take action. The greater the anticipation, the greater the dopamine spike. Temptation bundling is one way to make your habits more attractive. The strategy is to pair an action you want to do with an action you need to do.

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One of the deepest human desires is to belong. And this ancient preference exerts a powerful influence on our modern behavior.

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Using a sense of belonging can enable many things, such as communities, religion, niches, or small groups. This is also a direction for product development.

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Most of the time, going along with the group does not feel like a burden. Everyone wants to belong. If you grow up in a family that rewards you for your chess skills, playing chess will seem like a very attractive thing to do. If you work in a job where everyone wears expensive suits, then you’ll be inclined to splurge on one as well. If all of your friends are sharing an inside joke or using a new phrase, you’ll want to do it, too, so they know that you “get it.” Behaviors are attractive when they help us fit in.

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We imitate the habits of three groups in particular: The close. The many. The powerful.

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The 3 sources of habit imitation

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Chapter Summary The culture we live in determines which behaviors are attractive to us. We tend to adopt habits that are praised and approved of by our culture because we have a strong desire to fit in and belong to the tribe. We tend to imitate the habits of three social groups: the close (family and friends), the many (the tribe), and the powerful (those with status and prestige). One of the most effective things you can do to build better habits is to join a culture where (1) your desired behavior is the normal behavior and (2) you already have something in common with the group. The normal behavior of the tribe often overpowers the desired behavior of the individual. Most days, we’d rather be wrong with the crowd than be right by ourselves. If a behavior can get us approval, respect, and praise, we find it attractive.

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“It always starts with your friends. One friend smokes, then you try it.”

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Some of our underlying motives include:* Conserve energy Obtain food and water Find love and reproduce Connect and bond with others Win social acceptance and approval Reduce uncertainty Achieve status and prestige

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Find love and reproduce = using Tinder Connect and bond with others = browsing Facebook Win social acceptance and approval = posting on Instagram Reduce uncertainty = searching on Google Achieve status and prestige = playing video games

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Every habit corresponds to a primitive desire, so substitution is best

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“I’m not confined to my wheelchair—I am liberated by it. If it wasn’t for my wheelchair, I would be bed-bound and never able to leave my house.”

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Finance. Saving money is often associated with sacrifice. However, you can associate it with freedom rather than limitation if you realize one simple truth: living below your current means increases your future means. The money you save this month increases your purchasing power next month.

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Chapter Summary The inversion of the 2nd Law of Behavior Change is make it unattractive. Every behavior has a surface level craving and a deeper underlying motive. Your habits are modern-day solutions to ancient desires. The cause of your habits is actually the prediction that precedes them. The prediction leads to a feeling. Highlight the benefits of avoiding a bad habit to make it seem unattractive. Habits are attractive when we associate them with positive feelings and unattractive when we associate them with negative feelings. Create a motivation ritual by doing something you enjoy immediately before a difficult habit.

THE 3RD LAW: Make It Easy

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Walk Slowly, but Never Backward

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It is easy to get bogged down trying to find the optimal plan for change: the fastest way to lose weight, the best program to build muscle, the perfect idea for a side hustle. We are so focused on figuring out the best approach that we never get around to taking action. As Voltaire once wrote, “The best is the enemy of the good.”

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The best is the enemy of the good, and if you want the best, you won’t act

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Sometimes motion is useful, but it will never produce an outcome by itself. It doesn’t matter how many times you go talk to the personal trainer, that motion will never get you in shape. Only the action of working out will get the result you’re looking to achieve.

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Motion makes you feel like you’re getting things done. But really, you’re just preparing to get something done. When preparation becomes a form of procrastination, you need to change something. You don’t want to merely be planning. You want to be practicing.

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You will never be ready; preparation is just an excuse for procrastination

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Chapter Summary The 3rd Law of Behavior Change is make it easy. The most effective form of learning is practice, not planning. Focus on taking action, not being in motion. Habit formation is the process by which a behavior becomes progressively more automatic through repetition. The amount of time you have been performing a habit is not as important as the number of times you have performed it.

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When you wake up, making breakfast will be easy. Want to draw more? Put your pencils, pens, notebooks, and drawing tools on top of your desk, within easy reach. Want to exercise? Set out your workout clothes, shoes, gym bag, and water bottle ahead of time. Want to improve your diet? Chop up a ton of fruits and vegetables on weekends and pack them in containers, so you have easy access to healthy, ready-to-eat options during the week.

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Chapter Summary Human behavior follows the Law of Least Effort. We will naturally gravitate toward the option that requires the least amount of work. Create an environment where doing the right thing is as easy as possible. Reduce the friction associated with good behaviors. When friction is low, habits are easy. Increase the friction associated with bad behaviors. When friction is high, habits are difficult. Prime your environment to make future actions easier.

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“When you start a new habit, it should take less than two minutes to do.” You’ll find that nearly any habit can be scaled down into a two-minute version: “Read before bed each night” becomes “Read one page.” “Do thirty minutes of yoga” becomes “Take out my yoga mat.” “Study for class” becomes “Open my notes.” “Fold the laundry” becomes “Fold one pair of socks.” “Run three miles” becomes “Tie my running shoes.”

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Start with small habits

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The idea is to make your habits as easy as possible to start.

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The smaller the habit, the better, as it is easy to complete

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This is a powerful strategy because once you’ve started doing the right thing, it is much easier to continue doing it.

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A new habit should not feel like a challenge.

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The habit should not feel like a challenge

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People often think it’s weird to get hyped about reading one page or meditating for one minute or making one sales call. But the point is not to do one thing. The point is to master the habit of showing up. The truth is, a habit must be established before it can be improved.

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Small habits are the easiest to form, and they grow

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Chapter Summary Habits can be completed in a few seconds but continue to impact your behavior for minutes or hours afterward. Many habits occur at decisive moments—choices that are like a fork in the road—and either send you in the direction of a productive day or an unproductive one. The Two-Minute Rule states, “When you start a new habit, it should take less than two minutes to do.” The more you ritualize the beginning of a process, the more likely it becomes that you can slip into the state of deep focus that is required to do great things. Standardize before you optimize. You can’t improve a habit that doesn’t exist.

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Unsubscribe from emails. Turn off notifications and mute group chats. Set your phone to silent. Use email filters to clear up your inbox. Delete games and social media apps on your phone.

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Enroll in an automatic savings plan. Set up automatic bill pay. Cut cable service. Ask service providers to lower your bills.

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Of course, there are many ways to automate good habits and eliminate bad ones. Typically, they involve putting technology to work for you. Technology can transform actions that were once hard, annoying, and complicated into behaviors that are easy, painless, and simple. It is the most reliable and effective way to guarantee the right behavior.

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Eliminating bad habits through automation, such as canceling game subscriptions

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Medicine: Prescriptions can be automatically refilled. Personal finance: Employees can save for retirement with an automatic wage deduction. Cooking: Meal-delivery services can do your grocery shopping. Productivity: Social media browsing can be cut off with a website blocker.

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For example, automatically disconnecting the internet every night

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The inversion of the 3rd Law of Behavior Change is make it difficult. A commitment device is a choice you make in the present that locks in better behavior in the future. The ultimate way to lock in future behavior is to automate your habits. Onetime choices—like buying a better mattress or enrolling in an automatic savings plan—are single actions that automate your future habits and deliver increasing returns over time. Using technology to automate your habits is the most reliable and effective way to guarantee the right behavior.

THE 4TH LAW: Make It Satisfying

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The Cardinal Rule of Behavior Change

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We are more likely to repeat a behavior when the experience is satisfying. This is entirely logical. Feelings of pleasure—even minor ones like washing your hands with soap that smells nice and lathers well—are signals that tell the brain: “This feels good. Do this again, next time.” Pleasure teaches your brain that a behavior is worth remembering and repeating.

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Giving meaning to the behavior: Is washing water a chore or exercise? Is exercise tiring or enjoyment?

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The first three laws of behavior change—make it obvious, make it attractive, and make it easy—increase the odds that a behavior will be performed this time. The fourth law of behavior change—make it satisfying—increases the odds that a behavior will be repeated next time. It completes the habit loop.

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Tell yourself that you benefited from this response

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What is immediately rewarded is repeated. What is immediately punished is avoided.

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Behaviors that are rewarded are repeated; behaviors that are punished are abandoned

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Our preference for instant gratification reveals an important truth about success: because of how we are wired, most people will spend all day chasing quick hits of satisfaction. The road less traveled is the road of delayed gratification. If you’re willing to wait for the rewards, you’ll face less competition and often get a bigger payoff. As the saying goes, the last mile is always the least crowded.

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The less traveled road is less crowded, and delayed gratification often yields the biggest rewards

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Here’s the problem: most people know that delaying gratification is the wise approach. They want the benefits of good habits: to be healthy, productive, at peace. But these outcomes are seldom top-of-mind at the decisive moment. Thankfully, it’s possible to train yourself to delay gratification—but you need to work with the grain of human nature, not against it. The best way to do this is to add a little bit of immediate pleasure to the habits that pay off in the long-run and a little bit of immediate pain to ones that don’t.

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Human nature is instant gratification; we cannot go against human nature, so we need a little trick

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One solution is to turn the situation on its head. You want to make avoidance visible. Open a savings account and label it for something you want—maybe “Leather Jacket.” Whenever you pass on a purchase, put the same amount of money in the account. Skip your morning latte? Transfer $5.

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Open a dream account, and when you want to buy something, transfer it directly to the substitute account.

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One of my readers and his wife used a similar setup. They wanted to stop eating out so much and start cooking together more. They labeled their savings account “Trip to Europe.” Whenever they skipped going out to eat, they transferred $50 into the account. At the end of the year, they put the money toward the vacation.

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You do it because it’s who you are and it feels good to be you. The more a habit becomes part of your life, the less you need outside encouragement to follow through. Incentives can start a habit. Identity sustains a habit.

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Chapter Summary The 4th Law of Behavior Change is make it satisfying. We are more likely to repeat a behavior when the experience is satisfying. The human brain evolved to prioritize immediate rewards over delayed rewards. The Cardinal Rule of Behavior Change: What is immediately rewarded is repeated. What is immediately punished is avoided. To get a habit to stick you need to feel immediately successful—even if it’s in a small way. The first three laws of behavior change—make it obvious, make it attractive, and make it easy—increase the odds that a behavior will be performed this time. The fourth law of behavior change—make it satisfying—increases the odds that a behavior will be repeated next time.

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Making progress is satisfying, and visual measures—like moving paper clips or hairpins or marbles—provide clear evidence of your progress. As a result, they reinforce your behavior and add a little bit of immediate satisfaction to any activity. Visual measurement comes in many forms: food journals, workout logs, loyalty punch cards, the progress bar on a software download, even the page numbers in a book. But perhaps the best way to measure your progress is with a habit tracker.

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Chapter Summary One of the most satisfying feelings is the feeling of making progress. A habit tracker is a simple way to measure whether you did a habit—like marking an X on a calendar. Habit trackers and other visual forms of measurement can make your habits satisfying by providing clear evidence of your progress. Don’t break the chain. Try to keep your habit streak alive. Never miss twice. If you miss one day, try to get back on track as quickly as possible. Just because you can measure something doesn’t mean it’s the most important thing.

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Isn’t the number of days you read on Kindle a form of habit progress bar?

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Chapter Summary The inversion of the 4th Law of Behavior Change is make it unsatisfying. We are less likely to repeat a bad habit if it is painful or unsatisfying. An accountability partner can create an immediate cost to inaction. We care deeply about what others think of us, and we do not want others to have a lesser opinion of us. A habit contract can be used to add a social cost to any behavior. It makes the costs of violating your promises public and painful. Knowing that someone else is watching you can be a powerful motivator.

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Monitoring and Punishing Bad Habits

ADVANCED TACTICS: How to Go from Being Merely Good to Being Truly Great

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Chapter Summary The secret to maximizing your odds of success is to choose the right field of competition. Pick the right habit and progress is easy. Pick the wrong habit and life is a struggle. Genes cannot be easily changed, which means they provide a powerful advantage in favorable circumstances and a serious disadvantage in unfavorable circumstances. Habits are easier when they align with your natural abilities. Choose the habits that best suit you. Play a game that favors your strengths. If you can’t find a game that favors you, create one. Genes do not eliminate the need for hard work. They clarify it. They tell us what to work hard on.

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Choose the field that suits you

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The human brain loves a challenge, but only if it is within an optimal zone of difficulty. If you love tennis and try to play a serious match against a four-year-old, you will quickly become bored. It’s too easy. You’ll win every point. In contrast, if you play a professional tennis player like Roger Federer or Serena Williams, you will quickly lose motivation because the match is too difficult.

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Humans like challenges, but challenges without a chance of winning or interaction are hard to sustain

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The Goldilocks Rule states that humans experience peak motivation when working on tasks that are right on the edge of their current abilities. Not too hard. Not too easy. Just right.

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To find the right match, you need the right difficulty level to be motivated

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The greatest threat to success is not failure but boredom.

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The greatest threat to success is not failure, but boredom

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The only way to become excellent is to be endlessly fascinated by doing the same thing over and over. You have to fall in love with boredom.

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If you cannot make it interesting, then you must love boredom

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Chapter Summary The Goldilocks Rule states that humans experience peak motivation when working on tasks that are right on the edge of their current abilities. The greatest threat to success is not failure but boredom. As habits become routine, they become less interesting and less satisfying. We get bored. Anyone can work hard when they feel motivated. It’s the ability to keep going when work isn’t exciting that makes the difference. Professionals stick to the schedule; amateurs let life get in the way.

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The enemy of success is not failure, but lack of interest and boredom, so we must make it interesting. This applies to product development as well; it must have users and interaction and feedback from the start, otherwise, you won’t stick with it. You must have seed users from the beginning, and a group of people expecting it while it is in development.

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Chapter Summary The upside of habits is that we can do things without thinking. The downside is that we stop paying attention to little errors. Habits + Deliberate Practice = Mastery. Reflection and review is a process that allows you to remain conscious of your performance over time. The tighter we cling to an identity, the harder it becomes to grow beyond it.

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That’s the power of atomic habits. Tiny changes. Remarkable results.

The enemy of success is not failure, but dullness and lack of interest. Therefore, we must make it interesting.

The Key to Product Development

It is the same when building a product; you must have people using it, interacting with it, and providing feedback right from the start. Otherwise, it will be difficult to sustain. You must have seed users from the beginning, and a group of people anticipating it throughout the development process.

1. While trying to please them or leave a deep impression, do not overtly display your talents, lest it backfire—triggering their fear and anxiety.

Power Law 2: Never Trust Friends Too Easily; Learn to Utilize Your Enemies

1. If you hire a former enemy, they will be more loyal than a friend because they will be more eager to prove themselves to you.
2. Beware your friends! They betray you faster because they are more prone to developing jealousy. They will also be spoiled and become tyrannical.

Power Law 3: Conceal Your Intentions

1. Make yourself unpredictable and elusive. If they cannot grasp your intentions, they cannot prepare in advance. Mislead them down a deep path. Cast heavy smokescreens to confuse them.

Power Law 4: Speak Less Than Necessary

1. If you want to attract attention through words, the more you speak, the more mediocre you appear, and the less control you seem to have over the overall situation.
2. When speaking about mundane things, if you are ambiguous and off-topic, like a riddle, it will actually make people feel it is very novel.
3. Powerful people often establish authority and subdue others by speaking sparingly. The more you speak, the more likely you are to say something foolish.

Power Law 5: Defend Your Reputation at All Costs

1. Reputation is the cornerstone of power. With reputation alone, you can intimidate others and win victories. Once your reputation is damaged, you will find yourself in a state of helplessness, surrounded by enemies.
2. Learn to dig into the corners of your enemy’s reputation to destroy them. Once the opponent’s reputation is damaged, you merely need to stand by and watch, letting public opinion seal their fate.

Power Law 6: Be Noticeable at All Costs

1. Make yourself appear more majestic, brilliant, and mysteriously alluring than the ordinary masses, firmly capturing everyone’s attention.

Power Law 7: Let Others Work for You; Claim the Credit

1. Your assistants will be forgotten, but you will be remembered. Never do things yourself that others can do for you.

Power Law 8: Let Others Walk into Your Trap—Use Bait When Necessary

1. When you force others to take action, you seize the initiative and control of the situation.

Power Law 9: Win by Action, Not by Debate

1. Even if your arguments force others’ views to change temporarily,
2. You don’t need to say much; actions are more convincing, more likely to gain support, and more powerful.

Power Law 10: Avoid Unhappy and Unfortunate People

1. Emotional states are highly contagious, just like diseases. Perhaps you feel you are helping a drowning person, but you are only inviting disaster upon yourself.
2. The unfortunate are sometimes unfortunate due to their own actions, and they will pass that misfortune on to you. You should stay away from them and associate with happy and lucky people.

Power Law 11: Learn to Maintain Others’ Dependence on You

1. You must always make yourself needed and desired by others. The more others depend on you, the freer you are. As long as others’ happiness and success rely on you, you can be fearless. Do not teach them everything, or they will shake you off and act on their own.

Power Law 12: Use Selective Honesty and Generosity to Disarm Your Opponent

1. By selectively being honest, you open a gap in the opponent’s heavily guarded defenses, allowing you to deceive and manipulate them at will. Offer a timely gift—like the Trojan Horse—to make it easier for you to achieve your goal.

Power Law 13: When Asking for Help, Appeal to Their Self-Interest, Never to Pity or Gratitude

Power Law 14: Adopt the Persona of a Friend to Conduct Espionage

1. A better method is to act as the spy yourself. In polite social settings, learn to probe and investigate, asking roundabout questions to make people reveal their weaknesses and intentions.

Power Law 15: Completely Eradicate Your Enemy

Power Law 16: Use Absence to Gain Respect and Elevate Your Prestige

1. The more frequently you appear or the more news there is about you, the more ordinary you seem. If your position in a team is already stable, temporarily stepping back will make people talk about you more, and even admire you more. You must learn when to temporarily leave to elevate your value through absence.

Power Law 17: Make Others Tremble by Creating an Unpredictable Atmosphere

1. Humans are habitually curious creatures, always hoping to deduce something familiar from others’ actions. If others can predict your actions, they feel a sense of control over the situation. To reverse this, deliberately make them feel confused. This will make others anxious, and they will strive to fathom your behavior. When this strategy is pushed to its extreme, it will have a terrifying and intimidating effect.

Power Law 18: Don’t Build a Fortress for Self-Defense—Isolation is Dangerous

1. The best way is to mingle among the crowd, find allies, and blend in. The crowd is the best shield.
2. Isolation cuts off your valuable sources of information, making you highly visible and an easy target for attack.

Power Law 19: Know Who You Are Dealing With—Never Choose the Wrong Target

1. If you trick certain people once with a scheme or tactic, they will seek revenge for life. These people are wolves in sheep’s clothing. You must choose your opponent or victim extremely carefully, never offending or deceiving the wrong party.

Power Law 20: Don’t Depend on Anyone

1. Only fools rush to choose which side to stand on.
2. Maintain your independence, and you can calmly control them—watching the fight from afar, letting them attack each other, and then running to beg you.

Power Law 21: Pretend to Be Dumber Than Your Opponent—Win by Deception

1. The strategy is to make your opponent feel that they are very smart—not just smart, but smarter than you. Once they believe this, they will never suspect you have hidden motives.

Power Law 22: Employ the Strategy of Surrender: Gradually Convert Weakness into Strength

1. Do not give them the satisfaction of fighting and defeating you—surrender first.

Power Law 23: Consolidate Your Power

1. Find rich deposits and dig deep; the harvest will be much greater than shallow digging here and there. Depth and intensity must surpass width and breadth.
2. When seeking power resources to elevate yourself, find the key sponsors. This is like finding a cow that will provide milk for you long-term.

Power Law 24: Play the Role of the Perfect Courtier

1. The perfect courtier is always capable and adaptable. They master the art of indirect advancement, flattering and serving the powerful, while simultaneously displaying their power in the most indirect, subtle, and elegant way.

Power Law 25: Reshape Your Image

1. Always pay attention to your image and become the master of your own image; do not let others define it for you.
2. Do not readily accept the role society imposes on you. Reshape a new identity that is both eye-catching and not tiresome to the audience.

Power Law 26: Maintain Personal Integrity and Purity

1. You must maintain your spotless image. When necessary, you can use others as scapegoats or pawns to conceal your unspeakable actions.

Power Law 27: Manipulate the Weaknesses People Need to Believe In, Creating a Following

1. First, your words should strive to be vague, but they must contain promises. Emphasize fervor over rationality and clear thinking. Provide rituals that your followers can perform and demand that they sacrifice for your benefit. In the absence of organized religion or a lofty goal, the belief system you build will bring you unexpected power.
2. People have an irresistible, intense need for belief.

Power Law 28: Be Bold in Action

1. If you are unsure how to execute a plan, do not hesitate to try. Your doubt and hesitation will affect the execution of your plan. Cowardice is dangerous; it is best to act boldly and take a shot.
2. Everyone admires the bold and fearless; no one respects or admires the timid.

Power Law 29: Consider Everything, Plan to the End

1. Your plan must have a beginning and an end; you must consider the issues around the outcome.
2. Only by thinking long-term can you dominate destiny and determine the future.

Power Law 30: Make the Achievement Seem Effortless

1. During the process of achieving success, the actions must appear natural and easy. You must conceal the hard work, the effort, and all the clever tricks used.
2. The secret to success is your winning technique; do not teach it to anyone, or you will become the victim of your own technique.
3. Avoid letting others know that you are working tirelessly.

Power Law 31: Control the Choice: Let Others Play the Cards You Deal

1. The best deception is to make the victim believe they have a choice, making them feel they control the situation, when in reality, they are merely your puppet. Offer the victim options that benefit you; no matter how they choose, you will benefit.

Power Law 32: Utilize People’s Dreams

1. People often evade the truth of reality because the truth is ugly and unpleasant. Do not present the truth unless you are prepared for the massive anger of the people after the dream is shattered.

Power Law 33: Find Everyone’s Flaw

1. These flaws often signify a lack of security, inability to control emotions and desires, or a small secret pleasure. In any case, once found, it will become your winning technique to turn the tide.
2. You are dealing with people who conceal their weaknesses; as long as you find their weakness, you will utterly dismantle them.
3. Pay attention to various postures and unconscious signals.
4. If you realize someone has a need to be loved, publicly flatter and praise them.
5. Pretending to be interested is the most important start. Adopting a posture of attentive listening will encourage them to start confiding.
6. Find the helpless child.
7. Understanding their childhood needs gives you a powerful key to finding their weakness.
8. Look for contrasts.
9. Public behavior often hides the opposite character.
10. Those who boast often are cowards; beneath a proper exterior often hides a lustful soul; those who are neurotic often enjoy adventure and excitement, while the shy secretly crave attention.
11. Look beyond the exterior to the deep layers; you will find that a person’s weakness is often the opposite of what they show you.
12. Find the vulnerable link.
13. There must be a weak link in the chain; you must find the one who will yield under pressure.
14. Fill the void.
15. For unhappy people, find the root of their suffering. Filling their emotional void will become a major source of your power.
16. Utilize emotions that others cannot control.

Power Law 34: Make Others Treat You Like a Monarch—First, Act Like One

1. In the long run, appearing crude or low-class will lead others to look down on you, or even disrespect you.
2. Your behavior and demeanor must constantly exhibit the bearing of a monarch and confidence in power, making others believe that you are the one destined to wear the crown and become king.

Power Law 35: Learn the Art of Controlling Time

1. You must make others feel that you are always patient, as if you know that everything will naturally come to fruition.
2. A hurried demeanor reveals that you lack control over yourself and cannot control time.

Power Law 36: Scorn What You Cannot Have; Ignoring It is the Best Revenge

1. The more energy you invest in an enemy, the stronger they become. If there is something you love dearly but cannot obtain, show it complete disdain. The less interest you show, the more superior you appear.

Power Law 37: Create Unforgettable External Displays

1. Use external displays to dazzle the crowd, so that no one notices exactly what you are doing.
2. Eye-catching portraits and grand symbolic postures will cultivate an atmosphere of power, and the crowd will inevitably respond to it.
3. Enhance your charisma with striking images and radiant features, making others feel that your presence is extraordinary.

Power Law 38: Ideas Can Be Free, But Actions Must Conform to the Masses

1. Your creativity can only be shared with friends who are tolerant of your character and who will appreciate your uniqueness.
2. If you show signs of resisting the times, flaunting your unconventional ideas and non-traditional ways of thinking, people will assume you are merely trying to attract attention and look down on them.

Power Law 39: Stir the Pool to Catch Fish

1. Anger and loss of control are counterproductive strategically; therefore, you must always remain calm and objective. If you can provoke the enemy while remaining calm yourself, you have gained a decisive advantage.

Power Law 40: Scorn the Free Lunch

1. Things offered for free are dangerous; they usually contain a trick or hide a potential obligation; therefore, valuable things are worth paying for.
2. Paying full price is the smartest move, because excellence means no cutting corners.

Power Law 41: Try to Avoid Inheriting the Legacy of Great Figures

1. If you inherit the legacy of a great figure or a famous parent, it means you must achieve more than twice their accomplishments to surpass them in the public eye.
2. Change direction and build your own reputation and identity.

Power Law 42: Attack the Shepherd, and the Sheep Will Scatter

1. Trouble often traces back to individual individuals—people who like to exaggerate, subordinates who are arrogant and unreasonable.
2. Only by isolating or banishing them can you reduce their influence. By directly attacking the source of trouble, the blindly following masses will scatter.

Power Law 43: Focus on Others’ Emotions and Souls

1. The successful way to seduce others is to manipulate their psychology and weaknesses, softening the resistance by working on their emotions, and making a big deal out of what they love and fear.

Power Law 44: Use the Mirror Effect to Disarm and Enrage Your Enemy

1. Tempt them with illusion, making them believe that you recognize their value.
2. Enrage them by imitation, leaving them confused; or hold up a mirror to examine the enemy’s soul.
3. When we focus all our attention on our own reflection, it feels as if others are looking at us.
4. Imitating and reflecting others’ behavior makes them feel uneasy and annoyed. The opponent feels mocked, as if they have become a soulless image.
5. They feel powerless because you perfectly reflect their desires and wishes.
6. The narcissism effect of the daffodil.
7. Peek into the depths of others’ souls, see through their deep desires, values, and tastes, and then reflect everything back to them, making you “themselves” in their minds.
8. During the French Revolution, he was a radical Jacobin; after the Reign of Terror, he became a moderate republican; and under Napoleon’s rule, he became a supporter of imperial power. Napoleon used digging up ministers’ secrets as a secret weapon, and Fouché could also seize the secrets of Napoleon and others.
9. Your actions make others feel that you share their thoughts and goals.
10. If they doubt your motives, the mirror will be your primary shield, defending against them seeing through you.
11. This trick will completely enrage them and make them live in constant anxiety.
12. “One mouse can eat a hundred tons of iron bars, one owl can carry a child, what else is surprising?” When the friend heard this, he understood the merchant’s intention and begged for mercy, compensating at the original price. The son also returned to his side.
13. You must understand that everyone is wrapped in a shell of narcissism. If you want to impose your ideas on others, an invisible wall will be erected, and the obstacles will increase. But if you reflect them like a mirror, you will tempt them into narcissistic ecstasy.

Power Law 45: Advocate for Reform, But Don’t Reform Too Much at Once

1. People are creatures of habit. Too much innovation brings trauma, leading to resistance.
2. If change is forced by circumstances, let the process of change feel gentle, making everyone feel that this is merely an improvement upon the past.

Power Law 46: Don’t Appear Too Perfect

1. The most dangerous thing is appearing flawless. Jealousy will breed silent enemies.
2. Let others dissolve their jealousy into your small flaws, making you seem more human and approachable.
3. Only gods and the dead can achieve a state of perfection without being punished by others.

Power Law 47: Don’t Exceed Your Target; Learn to Stop at the Right Time in Victory

1. Under the excitement of victory, arrogance and overconfidence will push you beyond the original goal.
2. Once you go too far, the enemies you create will be more numerous than the opponents you defeated.
3. Set a goal, and when the chariot of victory arrives, stop immediately.
4. When you succeed, remember that when retreating from victory, you must always be cautious.
5. The moment of victory is the most intoxicating, but it is also the most dangerous.

Power Law 48: Conform to Change, Triumph Invisibly Over the Tangible

1. The best way to protect yourself is to flow like water and have no fixed shape.
2. Never bet on stability or permanence, because everything in the world is in constant flux.

1. What do I really want? (Vision.) 2. What is important about it? (Values.) 3. How will I get it? (Methods.) 4. What is preventing me from having it? (Obstacles.) 5. How will I know I am successful? (Measurements.)

Money is certainly one of the ways we can turn the dreams we have into the reality we live.

success leaves clues. People who succeed at the highest level are not lucky; they’re doing something differently than everyone else does.

I’ll put you in the room with these and many other superstars who get consistent results, decade after decade, in up markets and down, booms and busts. Together we will uncover the core secrets to their investment success and see how to apply them even to the smallest amount of money.

The idea is to know how to survive and thrive in any market condition. These real experts will explain how.
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they can anticipate the road ahead. Remember this: anticipation is the ultimate power.

This book is committed to one primary outcome: to set you up so you have an income for life without ever having to work again. Real financial freedom! And the good news is, it can be achieved by anyone.

It is not realistic to finance a 30-year retirement with 30 years of work. You can’t expect to put 10% of your income aside and then finance a retirement that’s just as long.

No matter where you live, if you don’t have another source of income, you could end up the best-dressed greeter at Wal-Mart.

It’s an amazing feeling to know you’ll never run out of income.

We know we need to save more and invest. So why don’t we do it? What’s holding us back?

SECTION 1: WELCOME TO THE JUNGLE: THE JOURNEY BEGINS WITH THIS FIRST STEP

SECTION 2: BECOME THE INSIDER: KNOW THE RULES BEFORE YOU GET IN THE GAME

SECTION 3: WHAT’S THE PRICE OF YOUR DREAMS? MAKE THE GAME WINNABLE

SECTION 4: MAKE THE MOST IMPORTANT INVESTMENT DECISION OF YOUR LIFE

SECTION 5: UPSIDE WITHOUT THE DOWNSIDE: CREATE A LIFETIME INCOME PLAN

SECTION 6: INVEST LIKE THE .001%: THE BILLIONAIRE’S PLAYBOOK

SECTION 7: JUST DO IT, ENJOY IT, AND SHARE IT

Compound interest is such a powerful tool that Albert Einstein once called it the most important invention in all of human history.

200 years after Franklin’s death, a period of time that had seen stocks grow at an average compounded rate of 8%,

our earned income will never bridge the gap between where we are and where we really want to be. Because earned income can never compare to the power of compounding! Money is better than poverty, if only for financial reasons.

Before you speak, listen. Before you write, think. Before you spend, earn. Before you invest, investigate. Before you criticize, wait. Before you pray, forgive. Before you quit, try. Before you retire, save. Before you die, give.

You have to move from just working for money to a world where money works for you.

You’re already a financial trader. You might not think of it in just this way, but if you work for a living, you’re trading your time for money. Frankly, it’s just about the worst trade you can make. Why? You can always get more money, but you can’t get more time.

If you stop working, you stop making money. So let’s take you out of the equation and look for an alternative approach. Let’s build a money machine to take your place—and, let’s set it up in such a way that it makes money while you sleep.

the most important financial decision of your life. The decision? What portion of your paycheck you get to keep. How much will you pay yourself—off the top, before you spend a single dollar on your day-to-day living expenses?

Whatever that number is, you’ve got to stick to it. In good times and bad. No matter what. Why? Because the laws of compounding punish even one missed contribution.

Can anybody remember when the times were not hard and money not scarce?

But here’s the key to success: you have to make your savings automatic.

It’s time to take the first of the 7 Simple Steps to your Financial Freedom! The most important financial decision of your life needs to be made right now! It’s time for you to decide to become an investor, not just a consumer. To do this, you simply have to decide what percentage of your income you will set aside for you and your family and no one else.

If you don’t want to work, you have to work to earn enough money so that you won’t have to work.

The bottom line is, if we feel like we’re losing something, we avoid it; we won’t do it. That’s why so many people don’t save and invest. Saving sounds like you’re giving something up, you’re losing something today. But you’re not. It’s giving yourself a gift today of peace of mind, of certainty, of the large fortune in your future.

Obviously money meant very different things for Adolf Merckle and Chuck Feeney. What does money really mean to you? Do you use money, or does money use you? Like I’ve said from the beginning: if you don’t master money, at some level, it’s going to master you.

Whatever emotion you’re after, whatever vehicle you pursue—building a business, getting married, raising a family, traveling the world—whatever you think your nirvana is, I have found it’s only an attempt by your brain to meet one or more of six human needs.

“What’s the secret to wealth?” And he said, “Tony, you know it, and you know it well. You teach it to everyone. It’s gratitude.”

BECOME THE INSIDER: KNOW THE RULES BEFORE YOU GET IN THE GAME

You have to learn the rules of the game, and then you have to play better than anyone else.

Whether you are a seasoned investor or just beginning to see yourself as an investor, the jungle that Ray Dalio so vividly described holds the same dangers for all of us. But most of the danger lies in the fact that what you don’t know can hurt you.

Money Power Principle 1. Don’t get in the game unless you know the rules!

But the system isn’t set up for your broker to have endless options and complete autonomy in finding what’s best for you. And this could prove costly.

Risk comes from not knowing what you’re doing.

The core concept of successful investing is simple: Grow your savings to a point at which the interest from your investments will generate enough income to support your lifestyle without having to work.

There are two phases to your investing game: the accumulation phase, in which you are socking away money for growth, and the decumulation, during which you are withdrawing income.

The goal of the nonprofessional should not be to pick winners—neither he nor his “helpers” can do that—but should rather be to own a cross section of businesses that in aggregate are bound to do well. A low-cost S&P 500 index fund will achieve this goal.

When you look at the results on an after-fee, after-tax basis, over reasonably long periods of time, there’s almost no chance that you end up beating the index fund.
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From 1984 to 1998, a full 15 years, only eight out of 200 fund managers beat the Vanguard 500 Index. (The Vanguard 500, put together by founder Jack Bogle, is a mirror image of the S&P 500 index.)

Just how badly does chasing performance hurt us? Over a 20-year period, December 31, 1993, through December 31, 2013, the S&P 500 returned an average annual return of 9.28%. But the average mutual fund investor made just over 2.54%, according to Dalbar, one of the leading industry research firms. Ouch! A nearly 80% difference.

Because we buy high and sell low. We follow our emotions (or our broker’s recommendations) and jump from fund to fund. Always looking for an edge. But when the market falls, when we can’t take the emotional pain any longer, we sell. And when the market is up, we buy more.

As a famous money manager named Barton Biggs observed, “A bull market is like sex. It feels best just before it ends.”

The goal in investing is to get the maximum net return for a given amount of risk (and, ideally, the lowest cost).

Life isn’t about waiting for the storm to pass; it’s about learning to dance in the rain. It’s about removing the fear in this area of your life so you can focus on what matters most.

• Stocks have by far been the best place to be for long-term growth over time. • Stocks are volatile. In the pages ahead, you will learn from the “market masters” how to “smooth out the ride” by investing in and diversifying across multiple different indexes. • Don’t be sold that someone is going to beat the market. Instead, align yourself with the market! Once you put your indexing plan in place (which we will do step by step), you won’t have to spend your time trying to pick which stock to buy because the index will have done it for you. This will save you a tremendous amount of time and angst in trying to pick a winner. • Begin to think like an insider! Never again will you tolerate the “herd” mentality in your own life.

MYTH 2: “OUR FEES? THEY’RE A SMALL PRICE TO PAY!”

The mutual fund industry is now the world’s largest skimming operation, a $7 trillion trough from which fund managers, brokers, and other insiders are steadily siphoning off an excessive slice of the nation’s household, college, and retirement savings.”

You put up the capital, you took all the risk, and they made money no matter what happened.
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MYTH 3: “OUR RETURNS? WHAT YOU SEE IS WHAT YOU GET”

Most people are familiar with the boilerplate disclaimer that past performance doesn’t guarantee future results. Far fewer are aware of how past performance numbers themselves can be misleading.

So if the fund advertises a 6% return, its investors achieved closer to 3%.

“Follow the money. Always follow the money.”

MYTH 4: “I’M YOUR BROKER, AND I’M HERE TO HELP”

“It is difficult to get a man to understand something, when his salary depends on his not understanding it.”

THE CHEF DOESN’T EAT HIS OWN COOKING

it was found that 49% of the managers owned no shares in the fund they manage. That’s right. The chef doesn’t eat his own cooking.

So the obvious question is, if the people who manage the fund aren’t investing in the fund they run, why in the world would I? Good question!!! The chef doesn’t eat his own cooking if the ingredients are bad or if he knows what the kitchen really looks and smells like. These fund managers are smart—they work under the hood.

MYTH 6: TARGET-DATE FUNDS: “JUST SET IT AND FORGET IT”

MYTH 7: “I HATE ANNUITIES, AND YOU SHOULD TOO”

MYTH 8: “YOU GOTTA TAKE HUGE RISKS TO GET BIG REWARDS!”

Remember Warren Buffett’s top two rules of investing? Rule 1: don’t lose money! Rule 2: see rule 1.

allow you and me to participate in the gains of the stock market without risking any of our principal!

But here’s the truth: the ultimate thing that stops most of us from making significant progress in our lives is not somebody else’s limitations, but rather our own limiting perceptions or beliefs.

Everybody has a fear of failure at some level; at times we’ve all been fearful that perhaps we are not enough.

Money is nothing more than a reflection of your creativity, your capacity to focus, and your ability to add value and receive back.

I want you to know that you’re the creator of your life, not just a manager. Sometimes

The day you stop racing is the day you win the race.

You can make them more conservative or more aggressive. You’re in control, so put in numbers that fit with your lifestyle, your current reality, and your future dreams.

One of the most powerful ways to accelerate the pace at which you achieve your financial goals—and the most painless way I know—is to implement the Save More Tomorrow plan,

She had left out a huge piece of future earnings, one that many people neglect to include in their financial planning: Social Security.

And yet contrast is a beautiful thing. When you get around people who are playing the game of life at a higher level, you either get depressed, pissed off, or inspired.

SPEED IT UP: 1. SAVE MORE AND INVEST THE DIFFERENCE

If everything seems under control, you’re not going fast enough.

The goal of these next minichapters is to get you thinking about how to make your financial dreams come true faster than you ever thought possible.

You can be rich by having more than you need, or by needing less than you have.

the best strategy to get around your belief system is to develop a new belief!

What if—in one fell swoop, in one single move—you could save a huge chunk of money toward your Financial Freedom, and it wouldn’t cost you a dime more?

You want to know the banker’s secret? Your interest payments will tack on an additional 100% or more to your loan value.

Prepay your next month’s principal, and you could pay off a 30-year mortgage in 15 years in many cases! Does that mean double your monthly payments? No, not even close! Here’s the key: Money Power Principle 3. Cut your mortgage payments in half! The next time you write your monthly mortgage check, write a second check for the principal-only portion of next month’s payment.

Take your $4 habit and boost it to $10 a day, and now you’re drinking away over $141,250 in savings over 20 years. That’s the cost of a four-year college education!

At the end of the day, the question to ask yourself is this: Do my expenses, big and small, bring me the thrill they once did?

“How do you truly become more valuable? Learn to work harder on yourself than you do on your job.

“All you have to do to earn more money in the same amount of time is simply become more valuable.”

And if you employ yourself, your raise becomes effective when you are!

“For things to change, you have to change. For things to get better, you have to get better.”

SPEED IT UP: 3. REDUCE FEES AND TAXES (AND INVEST THE DIFFERENCE)

Remember you get to spend only what you keep; if you invest with a 3% net return, it takes 24 years to double your money.

SPEED IT UP: 4. GET BETTER RETURNS AND SPEED YOUR WAY TO VICTORY

If you’re prepared, and you know what it takes, it’s not a risk. You just have to figure out how to get there. There is always a way to get there.

SPEED IT UP: 5. CHANGE YOUR LIFE—AND LIFESTYLE—FOR THE BETTER

My favorite things in life don’t cost any money. It’s really clear that the most precious resource we all have

Never test the depth of the river with both feet.

Asset allocation is the most important investment decision of your lifetime,

He told me that there are only three tools for reducing your risk and increasing your potential for financial success: 1. Security selection—stock picking; 2. Market timing—short-term bets on the direction of the market; and 3. Asset allocation—your long-term strategy for diversified investing.

It means dividing up your money among different classes, or types, of investments (such as stocks, bonds, commodities, or real estate) and in specific proportions that you decide in advance, according to your goals or needs, risk tolerance, and stage of life.

good people often fail because they do the right thing at the wrong time.

I don’t gamble, because winning a hundred dollars doesn’t give me great pleasure. But losing a hundred dollars pisses me off.

when you buy shares of an ETF, you are not buying the actual stocks, bonds, commodities, or whatever else is bundled in the fund—you are buying shares in an investment fund that owns those assets.

if you have your money machine in full gear, and you have the desire, there’s nothing wrong with setting aside a tiny percent of your Risk/Growth Bucket to pick some stocks and do some day trading. “Index your important money, then go have fun,” Burton Malkiel told me. “It’s better than going to the racetrack.” But, he said, limit yourself to 5% or less of your total assets or portfolio.

What if I put my money in the stock market at its peak, and it starts dropping? Or if I buy into a bond fund, and the interest rates begin to spike? Markets are always going to fluctuate, and we’ve learned that nobody, I mean nobody, can consistently and successfully predict when it’s going to happen. So how do we protect ourselves from all the ups and downs and really succeed?

“We tend to put money into the market and take it out at exactly the wrong time.”

Nobody could guess that the US government would do something that no government has ever done in human history—it decided to prop up the markets by “printing” $4 trillion, while telling the world that it would continue to do so indefinitely, literally until the economy recovered!

if you think you can time the markets, you’re wrong.

Far more money has been lost by investors preparing for corrections, or trying to anticipate corrections, than has been lost in corrections themselves.

Remember, the goal is to take emotion out of investing because emotion is what so often destroys investing success, whether it’s greed or fear.

You can actually make higher returns by investing regularly in a volatile stock market.

to be a successful investor, you need to rebalance your portfolio at regular intervals.

allocation is everything! So you want to diversify between your Security Bucket and your Risk/Growth Bucket. You want to diversify across asset classes, markets, and time. 2. You don’t want to hesitate to get in the market trying to have perfect timing; instead, use dollar-cost averaging and know that volatility can be your friend, providing opportunities to buy investments cheaply when the market is down. This technique will increase your portfolio’s value when the markets come back up. 3. Have a Dream Bucket that gives you emotional juice and excitement so you can experience the benefits of your investing prowess in the short term and midterm instead of just someday far in the future. 4. Use rebalancing and tax harvesting to maximize your returns and minimize losses.

Here is the reality: most people couldn’t stomach another 2008 without selling some or all of their investments.

Remember, a 66% loss would require nearly 200% gains just to get back to even—just to recoup the portion of your nest egg that it may have taken your entire life to save!

FREEDOM: CREATING YOUR LIFETIME INCOME PLAN

I have enough money to retire comfortably for the rest of my life. Problem is, I have to die next week.

When I was young, I thought that money was the most important thing in life; now that I am old, I know that it is.

No matter what anyone tells you, or sells you, there isn’t a single portfolio manager, broker, or financial advisor who can control the primary factor that will determine if our money will last.

you are dead, who cares?! What’s painful is if you live too long with no income—that’s when you’ll really suffer.”

The key to abundance is meeting limited circumstances with unlimited thoughts.

Entrepreneurial Startup - Establishing a company independently or with partners, bringing goods or services to the market, and obtaining a share of the corporate profit. Investment Startup - Sharing the growth returns of a startup through angel investing or venture capital. Securities Investment - Purchasing securities assets in the stock market and sharing the operating profit of listed companies. Ownership of Means of Production - Purchasing means of production such as equipment or real estate, and profiting from renting them out. Utilization of Intellectual Property - Collecting usage fees by obtaining patents or copyrights. Operating Commercial Activities - Obtaining intermediary profit through wholesale, retail, etc. Providing Commercial Services - Such as financial intermediaries or real estate agents. Building Investment Platforms - Such as obtaining the spread from P2P lending platforms.

In summary, the way individuals obtain capital returns through investment and commercial means, rather than direct labor, can be considered obtaining true profit. Obtaining this portion of income requires bearing risk.

This phenomenon is known in economics as the “Marginal Productivity Theory.” It posits that there is a relationship between the wage level and the marginal output of labor (which is the increase in output generated by adding one unit of labor). When a profession’s wage is higher than its marginal output, it attracts more people to join, thereby increasing the labor supply, which in turn lowers the wage level until marginal output and the wage level reach equilibrium.

This phenomenon is prevalent in many professions and industries. When supply and demand in the market tend toward equilibrium, the wage level usually tends toward the value of the marginal output—this is the situation where profit approaches zero. In the long run, the market forms a relatively stable equilibrium state, and the wage level adjusts to match the skills, labor output, and market demand.

This also explains why continuous learning and skill improvement are extremely important for individuals to achieve success and obtain better compensation in the workplace. By constantly improving their skills and knowledge, individuals can maintain competitiveness in a fierce market and achieve better economic returns.

If you wish to earn profit beyond the inherent value of the labor itself in the labor market, you can consider the following strategies:

Differentiation and Specialization: Find the field or specific skill you excel in, and continuously refine it to become an expert. Through differentiation and specialization, you can provide higher quality and more specialized services, thereby creating higher market value for yourself.

Creating Unique Value: Identify pain points or needs in the market and provide unique solutions. Understand the customer’s true needs and offer services that exceed their expectations. This can win you more customers and positive word-of-mouth, leading to profit beyond the inherent value of the labor.

Building a Personal Brand: Establish your visibility and authority in the industry through effective branding and self-promotion. A reputable and credible personal brand can bring you more business opportunities and chances, potentially leading to higher returns.

Mastering Hybrid Skills: Learning and mastering skills across multiple domains allows you to become a versatile individual. Possessing multiple skills increases your flexibility and adaptability, better meeting market demands, which brings you more opportunities and potential profits.

Innovation and Leadership: Continuously innovating and leading teams to achieve goals can bring you more business opportunities and project collaborations, thereby creating extra profit for you.

It is important to emphasize that pursuing profit beyond the inherent value of labor is not easy; it requires a significant investment of time, effort, and resources. Furthermore, success is not achieved overnight; it requires continuous effort and ongoing learning and growth. The key is to find the development path and strategy that suits you and continuously optimize and adjust it through practice. In a fiercely competitive market, only by continuously enhancing your value can you gain more opportunities and profits in the workplace.

Simply put, Producer Surplus is the net gain for the producer in a transaction. Its calculation involves two key factors:

Producer’s Supply Price: This refers to the price at which the producer is willing to sell the goods or services. Typically, the producer’s supply price is related to their marginal cost (the extra cost of producing one unit of goods), because they hope to at least cover the production cost.

Market Price: This refers to the price the buyer is willing to pay, which is the market price of the goods or services.

The formula for calculating Producer Surplus is as follows:

Producer Surplus = Producer’s Supply Price - Market Price

Producer Surplus represents the net gain obtained by the producer when selling goods at a lower supply price. Producer Surplus occurs when the market price is higher than the producer’s supply price, because the producer sells the goods at a lower price but receives a higher actual income. If the market price is lower than the producer’s supply price, the Producer Surplus will be negative, meaning the producer may incur a loss in the transaction.

Producer Surplus is very important for understanding market operations and the supply-demand relationship. In a free market, the balance of supply and demand determines the market price, and Producer Surplus helps us understand the producer’s profitability at different price levels. When the market is in equilibrium, Producer Surplus reaches its maximum, meaning the producer achieves maximum profit.

Okay, Consumer Surplus is an economic term that refers to the economic benefit or value obtained by consumers when purchasing goods or services. Its calculation method is:

Consumer Surplus = Consumer’s Reservation Price (Expected Price) - Actual Price Paid

For a simple example, assume the reservation price for an item is 100 Yuan for the consumer. If the actual market price is 80 Yuan, then the Consumer Surplus obtained by that consumer is 100 - 80 = 20 Yuan.

Consumer Surplus reflects the net gain obtained by the consumer after purchasing goods or services. The larger the Consumer Surplus, the higher the economic utility obtained by the consumer. Increasing Consumer Surplus can usually raise total social welfare. Governments take many measures to increase Consumer Surplus, such as subsidies, tax incentives, etc.

The reason for “studying a lifetime” yet insisting on “never using it a lifetime” is the fear of making mistakes. When children make mistakes, they often face punishment. After adulthood, even without punishment from others, making mistakes can lead to self-inferiority and embarrassment. Therefore, many people avoid errors “at all costs.” However, you must know that the process of acquiring knowledge cannot be separated from trial and error. Without trial and error, comprehensive and genuine progress is impossible. So, you must know that making mistakes is normal, even indispensable. When doing things, making mistakes is inevitable. If you are doing something and there are absolutely no mistakes, then you are not doing something—you are dreaming.

“animals are born equal, but some animals are more equal than others.”

There are many benefits to being able to read English fluently. The word “freedom” is basically the biggest summary. For example, we can read primary source materials directly, without having to wait a long time to read translations that are actually riddled with errors. Translations are often unreliable because translation is truly a very, very difficult job. Many times, the unreliability of the translation is not the fault of the translator; at least, a part of the language is fundamentally untranslatable. If you can read English fluently, you will inevitably laugh occasionally when reading a translated work—for many mistranslated sentences, you can even reconstruct the original English in your mind based on experience. Not relying on translation is a great liberation. When your English reading becomes proficient to a certain degree, you will naturally feel grateful; it is a priceless relief. However, that time hasn’t come yet. As for the present, whether you believe it or not is up to you.

Not Knowing Oneself

— Because Chinese nouns do not distinguish between singular and plural, and Chinese verbs do not have tenses. After eliminating these two errors, it is equivalent to solving most of the problems.

“Agreement/Consistency Relationships”: Subject-verb agreement, tense agreement between the main clause and the subordinate clause, agreement between non-finite verbs and the logical subject (active/passive relationship), pronoun reference agreement, agreement of parallel components’ structure…

As an English user, don’t be misled by English teachers. As teachers, as part of an educational product, they naturally emphasize “correctness,” “accuracy,” and “standard”—regardless of whether they themselves are truly “correct,” “accurate,” or “standard.” Sometimes it is quite sad to think that most teachers are forced to raise their own standards, not out of a desire for progress, but merely to satisfy the practically unreasonable expectations of the “consumer.” English teachers are human, and thus most of them have the same psychological or, rather, human limitations as most other people. When a person cannot achieve something, they will pretend, and keep pretending until they themselves believe it.

Another important worry about daring to speak English is being ridiculed by those around you. This is indeed annoying. But think about it: Would a normal person mock a baby’s stumbling steps? No. Would a normal person mock a disabled person? No, and they shouldn’t. So look at it this way: Is it reasonable that someone speaking a foreign language with non-standard or unpleasant pronunciation will be mocked? Is it reasonable that someone speaks a foreign language their whole life with an accent and cannot correct it, yet is mocked?

“Whether or not you understand” is not important here. The purpose of significantly increasing the auditory input volume is to rebuild speech recognition ability; the focus is not on textual comprehension ability. Babies…

Bilingual Speech Filter

…should have been solidified long ago. In fact, I highly suspect that various types of English early childhood education consume too much time that could have been used to acquire other skills, thereby limiting the development of the young child’s brain. However, you cannot rely on just listening to recordings or watching TV for a child to learn a foreign language.

— As long as you start, you will find that it is not difficult, because “even if you don’t understand, it doesn’t matter.” If you listen a lot, and listen for a long time, sooner or later, it won’t be easy to not understand. Of course, even at the beginning, for better results, you can consciously and gradually increase the text difficulty, and it is best to combine it with intensive reading. During this period, almost everyone will feel like there is no progress, but this kind of…

Brainstorming

The most serious yet most subtle reason among the important reasons why most people ultimately fail in learning English might be this: most people demand too much from short-term gains, but demand too little from long-term gains.

In fact, most people find it difficult to fluently read any sentence in their native language—even though most people believe they can do it. For example, perhaps most people can relatively fluently read any sentence from The Reader magazine without any preparation.

And these “speed reading” suggestions are basically treating the symptom, not the root cause, because they only solve the problem of input speed, not the problem of comprehension speed after input. No matter how fast the input speed is, if the comprehension speed cannot keep up, what good is it? Sometimes, you can’t figure out why so many people clearly think in their minds that they want to improve…

1. Picking up a dictionary and looking up words by yourself is one of the most direct and effective ways to improve reading comprehension.

2. Even those who don’t look up words in a dictionary, every organ in our body possesses a certain “evolutionary ability” to some degree. If you play the piano for a long time, your fingers will become more flexible; if you exercise consistently for a long time, your cardiovascular function will become stronger; if you speak more than others, your tongue will become more flexible.

The biggest difference between English teachers and students might be just one: English teachers must look up words in a dictionary (and perhaps grammar books or other reference books), while students have another choice besides looking up words—attending various courses. What does the teacher do in English class? Actually, they mostly just lecture the students on the words, phrases, and sentences that they looked up the previous night and then had to think hard to understand using the dictionary (and other reference books). And the students? They sit below and listen. The students listen, but essentially, they do not participate in the process of reading comprehension.

If you meet a person of the opposite sex who doesn’t understand that “love” and “marriage” are not the same thing, it is best to keep your distance, otherwise a painful life “is waiting for you not far away”…

If you meet someone who is confused about the difference between “government” and “nation,” don’t easily communicate with them, otherwise you might find yourself facing endless troubles and infinite disasters…

If you meet someone who doesn’t know that “goal” and “plan” are not the same thing, and doesn’t know that they themselves might ultimately fail to achieve the goal because of “sticking rigidly to the plan”…

If you meet someone who doesn’t know that “attending school” and “studying” are not the same thing, some of them might look down on those who graduated from vocational schools simply because they have a Ph.D.; conversely, others might hate those with Ph.D.s simply because they only have a vocational diploma…

If you meet someone who doesn’t know the difference between “a person” and “a person’s opinion,” they might either blindly worship authority or treat themselves as the absolute authority…

If you meet someone who doesn’t know the difference between “Action” and “Reaction,” they might end up being a slave to their surrounding environment for life, all while remaining in a completely unconscious state…

Many students hate history class, but it is actually just that they haven’t understood the important difference between “history” and “a history book”…

Organizing vocabulary. You should know that after reading an article, organizing the vocabulary yourself is far more efficient than memorizing words from a textbook—unfortunately, most people do not believe this.

A fifth-grade student, if they can manage to read independently for 10 minutes every day, will read 622,000 more words per year than children who do not engage in independent reading…

— Whether it is abstract or concrete. What is the function of an adjective? You use an adjective to record your perception of the thing you can sense. What about a verb? A verb is used to record the action emitted by the thing you can sense. And finally, what about an adverb? When an adverb modifies a verb, it is used to record your perception of the action emitted by the thing you can sense; when an adverb modifies an adjective, it is used to record your perception of the perception of the thing you can sense. (This minute’s content looks somewhat convoluted, but as long as you can accurately punctuate and understand these words, in just one minute, you will have undergone a complete transformation.)

“Concise, simple, effective, accurate, specific.” Of course, this is not an iron law; if you have the ability to explain the principle clearly using ornate words, that is not impossible; conversely, telling a moving story using simple language is also acceptable. But everyone who hopes that their thoughts can be effectively expressed should keep this standard of ten words firmly in mind.

Relying on renting out time is impossible to get rich. You must own equity (a part of the company) to achieve financial freedom.

One way to gain wealth is to provide society with what it needs but cannot obtain, and achieve scale.

To gain wealth, you must fully utilize the leverage effect. Business leverage comes from capital, labor, and products whose marginal cost of replication is zero (code and media).

There is a large number of robots available for us to use for free. To improve thermal efficiency and save space, these robots are concentrated in data centers. Use them.

Study microeconomics, game theory, psychology, persuasion, ethics, mathematics, and computer science.

Set a bold personal hourly rate and strictly enforce it. If the cost saved by solving a problem is less than your hourly rate, ignore the problem; if the cost of outsourcing a task is less than your hourly rate, choose to outsource it.

What you truly want is wealth. Wealth is assets that can make money for you even while you sleep. Wealth can be factories and robots that produce. Wealth can be computer programs that serve clients day and night. Wealth can also be money in the bank that is invested in other assets or businesses.

To make money in society, you must provide society with what it needs but cannot obtain. If society has already created the needed products and services, you will no longer be needed.

Through the internet, everyone can find their audience. As long as you engage in unique self-expression online, you have the opportunity to spread happiness, accumulate wealth, build products, and start businesses. [78]

The starting point is not important; the action itself is what matters. Therefore, adhering to moral standards is not easy.

If you do not hold company equity, the correlation between personal input and returns will be very strong. Almost all salaried jobs, even high-paying professions like lawyers or doctors, require time input to earn corresponding income.

The first is labor leverage, which means having others work for you. Labor leverage is one of the oldest forms of leverage, but in modern society, its effectiveness is not the best. [1] I even consider it the most outdated form of leverage. Because managing others is a very complex and challenging job that requires superb leadership skills; otherwise, the manager might end up being abandoned by their followers and devoured by their subordinates. [78]

Capital is the second, relatively better form of leverage. Capital leverage is using money to expand the influence of decisions. [1] Capital is a more modern form of leverage, and utilizing it has a certain difficulty, requiring certain skills. In the 20th century, people gained astonishing wealth by using capital leverage. Capital leverage was the main form of leverage in the 20th century.

And things like programming, writing books, recording podcasts, tweeting, and filming videos do not require permission from anyone. It can be seen that new leverage acts like a balancer, greatly narrowing the gap between people and making society more equal. [78] For example, every excellent software developer now has a large group of robots working for them. After writing the code, these robots start working and earning money for the developer even while they sleep. [78] Relying on renting out your time can never lead to wealth.

One major goal of life should be to control your own time. The ideal job is one that utilizes the leverage effect. In this working model, you can control your time and be responsible for your output and results. If you bring a miraculous turning point to a company by providing an excellent solution, you will certainly receive financial rewards. Especially if others don’t even know how you did it, they must continuously pay you to keep providing that product or service. And the reason you can do this is because of your obsession, skills, or talent.

One other thing that benefits me: I value freedom above all else. The freedom I speak of is diverse: the freedom to do what you want to do, the freedom not to do what you don’t want to do, the freedom from being influenced by self-emotions or external factors, etc. Freedom is the value I cherish the most.

To face reality, you must let go of the self, eliminate self-consciousness, forget self-judgment, and calm self-emotions. Although humans are advanced animals, the existence of emotional self-consciousness brings rumination, allowing certain desires to blind our eyes, making us unable to see reality clearly, and thus leading us to rashly judge “how the world should be.” This situation often occurs, especially when mixing political demands with business issues.

The difficulty lies in seeing the truth clearly. To see the truth clearly, you must escape the self, because the self does not want to face the truth. The weaker the self, the fewer the restrictions on its reactions, and the lower the obsession with the desired outcome, the easier it is to see reality clearly.

The yearning for a beautiful reality blinds the perception of the real world. What is called suffering is the inability to continue ignoring the facts.

Note - Location 1130 The more I crave solving a problem in a specific way, the less likely I am to see the facts clearly.

Without thinking, you won’t have outstanding business ideas, nor can you make correct judgments. I encourage everyone to spend at least one day a week thinking (preferably two days, because even if you set aside two days, it might end up being one).

Only a relaxed brain can generate great ideas. A person who feels immense pressure, is bogged down in paperwork, is constantly running around, and is overwhelmed cannot think. Therefore, you must squeeze out time for thinking. [7]

Almost all biases are designed to help people make quick judgments when information is incomplete. For important decisions, set aside memory and identity, and focus on the problem itself.

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If it is difficult to choose, the answer is negative.

The difference between people is not “educated” and “uneducated,” but “likes reading” and “dislikes reading.”

Read classic works in mathematics, science, and philosophy. Don’t read bestsellers, don’t watch the news. Avoid joining any so-called “book clubs,” avoid pursuing any social conformity. Place truth above social conformity. [11]

The reality is, life is a single-player game. A person is born alone, dies alone, and interprets everything in the world alone. Your memories belong only to you. Before you are born, no one cares; after you leave the world, no one cares. You exist in the world for only a few decades; life is a single-player game.

Essentially, the process of life is replacing bad habits formed unintentionally with well-cultivated good habits, striving to become a happier person. Your happiness index ultimately depends on your habits and the people you spend the most time with.

The more secrets you have, the lower your sense of happiness. [11]

The purpose of the news is to make people feel anxious and angry. But the science, economics, education, and conflict trends behind the news have positive significance. You must maintain a good state of mind and an optimistic attitude. [11]

1. Insurance: Purchasing appropriate insurance is the most basic and important risk management tool. Health insurance, car insurance, property insurance, life insurance, etc., can provide you with economic support and protection when accidents or disasters occur.

2. Diversified Portfolio: When investing, diversifying funds across different asset classes, such as stocks, bonds, real estate, and cash, helps spread risk. Such a diversified portfolio can reduce losses when specific assets perform poorly.

3. Emergency Savings Fund: Establishing an emergency savings fund is used to cope with sudden emergencies and unexpected expenses. It is usually recommended to save an amount equivalent to three to six months of living expenses as an emergency reserve.

4. Stop-Loss Strategy: In investing, setting a stop-loss point is a common risk management method. By setting a price point, assets are automatically sold when the asset price falls to a certain degree, avoiding further losses.

5. Professional Financial Advisor: Seeking the help of a professional financial advisor or wealth planner can help you formulate personalized risk management strategies and make reasonable plans based on your goals and risk tolerance.

6. Long-Term Investment: Long-term investment is usually more stable than short-term speculation because it can smoothly handle market fluctuations and achieve more stable returns through the accumulation of time.

7. Healthy Lifestyle: Maintaining a healthy lifestyle helps reduce medical costs and health risks. Regular physical examinations and maintaining healthy eating habits can reduce the possibility of illness.

8. Compliance with Laws and Regulations: Complying with laws and regulations, including traffic rules and building safety standards, can reduce many potential property and liability risks.

9. Education Planning: Planning for children’s education in advance helps alleviate the pressure of future educational expenses.

10. Debt Management: Managing personal debt, ensuring that the debt burden is reasonable and does not exceed one’s capacity to bear.

In summary, risk management is a crucial part of personal financial planning. By using appropriate tools and methods, you can better protect your and your family’s financial security and plan for the future.

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The dollar-cost averaging strategy includes the following key points: What exactly is the asset? How long is the long term? How long is the regular interval? What is the minimum amount invested each time?

2 The securities trading market is the ninth great wonder of the world.

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People always think that “choosing stocks” is a very difficult thing—but actually, it’s not difficult at all! Because that so-called “difficulty” is entirely caused by habitual thinking. In reality, it is merely the result of people being unwilling or afraid to use the simplest, most direct, and most effective method. This method is so simple, so unbelievably simple: simply choose the stocks that everyone in the market favors the most.

3 Is there really an investment asset that only rises and never falls?

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Therefore, Buffett always recommends that ordinary people buy the S&P 500 index fund—in China, the corresponding asset for the S&P 500 is the CSI 300 index fund. The advantage of index funds is that they are essentially equivalent to “following the market.” You don’t have to gamble on the luck of a specific company; instead, you gamble on the luck of the entire nation, or the luck of the entire world—in any case, the human economy is constantly growing in the long run. Look, as long as it’s the long term, it suddenly stops being a gamble, because in the long run, the risk can be diluted to almost nothing.

4 The only correct way for ordinary people to invest.

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Those who “go all-in” (bet everything) cannot endure the pain for too long—in fact, no one can endure pain long-term. This has absolutely nothing to do with so-called “strength.” From another perspective, this isn’t foolishness; it’s just ignorance. After the pain of one month, or two months, three months, and even when it seems like you are about to get through it, that is, around the sixth month (or slightly before), many people will exit for various reasons—in the trading market, this behavior is called “cutting losses.” Look, the leeks (retail investors) cut themselves, and what they cut are bloody pieces of meat.

5 Why few people use the dollar-cost averaging strategy.

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6 The profound mechanism behind the magical power of the dollar-cost averaging strategy.

Highlight(yellow) - 6.1. Everyone should cultivate their proactive personality > Location 472

Highlight(yellow) - 6.1. Everyone should cultivate their proactive personality > Location 482

Stay away from those who complain all day—they don’t know what they are doing. They complain with righteous indignation and great spirit about unfairness, as if Heaven itself is on their side. They never want to know the truth: this world is unfair. Using a more accurate, unbiased, and neither humble nor arrogant term to describe it, this world is full of asymmetry, just as it is full of uncertainty.

Highlight(yellow) - 6.2. Most proactive people actually don’t know their boundaries > Location 540

Their own future will not improve as parents; their children are unknowingly turned into “passive people regarding themselves.” The correct choice should be: parents should proactively make themselves better and better; thereby making the children desire to improve out of envy, and the children will take the initiative, even if it is merely superficial imitation that is a good start.

Highlight(yellow) - 6.4. The optimal strategy for mastering trends must be proactive passivity > Location 636

Whether a decision is significant or meaningful can be judged by just one standard: Is it a choice directed toward the trend?

Highlight(yellow) - 6.4. The optimal strategy for mastering trends must be proactive passivity > Location 665

Highlight(yellow) - 6.5. Dollar-cost averaging is the best strategy for practicing “proactive passivity” > Location 680

Highlight(yellow) - 6.6. Just how powerful is the passive force of following the trend? > Location 772

The longer the investment cycle, the greater the passive advantage; the larger the investment amount, the greater the passive advantage.

Highlight(yellow) - 6.7. How much space do you still have within the proactive boundary? > Location 818

The truth has no obligation to cater to your emotions.

Highlight(yellow) - 6.8. The long-term perspective determines your results > Location 868

If you feel desperate, it is simply because you are poor right now. If your feeling is very desperate, it is simply because you are truly poor right now.

Highlight(yellow) - 6.8. The long-term perspective determines your results > Location 872

The poorer you are, the more patience you need. What is courage? Courage is the only virtue that cannot be faked.

Highlight(yellow) - 6.8. The long-term perspective determines your results > Location 903

One rise is not a trend, and one fall is not a trend; a rise plus a fall constitutes a cycle; judging the trend requires at least two cycles. After two cycles, the two fluctuations can only constitute one of three trends: rising, horizontal, or falling.

Highlight(yellow) - 6.9. What kind of extreme advantage do ordinary people possess? > Location 992

More than ten years ago, I occasionally heard two middle managers from a large company discussing how to make their subordinates obedient: “Sigh, how did you manage to make them obedient?” “I’m really worried!"—But isn’t it simple? Organize a ‘wife team’ (group of wives) to go look at properties! Let me tell you, don’t look down on them now that they are acting so powerful in front of you. As long as they buy a house and pay the down payment today, tomorrow they are mine! No doubt about it!

7 The difference between stupidity and ignorance, and passive wisdom.

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8 Some people are always on the correct side.

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For all ordinary people, the dollar-cost averaging strategy is absolutely viable, completely genuine, and relies entirely on yourself. By “ordinary people” here, we mean people regardless of race, nationality, region, gender, age, height, weight, beauty, or ugliness, or sexual orientation… The key is that they don’t even differentiate by IQ and education level!

9 The general condition of sentient beings on the other side of the mirror world.

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Their explanations are always astonishingly consistent: “Sigh, I am just too greedy!”

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10 Dollar-cost averaging is the essential choice for ordinary people.

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The three conditions that determine a person’s wealth are: background, luck, and effort; and among these three, effort is the most negligible.

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Conclusion

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Within your proactive boundary, continuously strengthen your psychological construction and desperately find ways to make money outside the market. At the same time, outside the proactive boundary, proactively choose an asset that is absolutely worth holding long-term, and use the money you earned outside the market to invest regularly… Over time, you can harness the magical passive force generated by the trend, not only potentially break free from the shackles of class solidification, but even change your destiny—ultimately, achieve freedom.

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The national destiny seems to be an ultimate asset; I should dollar-cost average the S&P 500.

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The Three Iron Laws of Time Selling: Growth is the fundamental key, prioritize value over valuation, and patience is more important than anything else.

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What is called personal financial freedom means that a person no longer needs to sell their time just to meet basic living necessities.

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There is only one standard for selection: Can what I choose help me accumulate more ability?

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Nowadays, food delivery is very developed. When I go to pick up food, I often think: so many people are selling their time at such cheap prices, and what they are doing is something that has absolutely no compounding effect. What will they do in the future?

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If you don’t need to break through, you don’t need to grow, and you don’t need to learn further. Doing such a job might give you a sense of achievement that merely consoles oneself (mostly from stability), but because there is no growth, you can never cross a milestone in your lifetime.

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It is a habit, because the short-term gains from deception are always very high. In the long run, this habit is almost impossible to eradicate. You see, the reason it is hard to adhere to the iron laws is because the temptation to violate them is too great. But looking at it the other way, all deceptions are not permanent; there will always be a day when the truth comes out. From this perspective, the advice given by Dario Bridgewater is truly wise.

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People who lack patience are more likely to choose “Endpoint Thinking.” They hope to finish quickly, see results quickly, and then reach the world they have imagined. [Incomplete sentence: 沒耐…]

01.20160801 Three Major Pitfalls Hindering Financial Freedom ★

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1. You must focus all your most precious attention on your own “Growth.” 2. Entrepreneurship is growth. Without growth, it is not entrepreneurship. 3. People who don’t cherish their attention are destined to be poor in the end, because they will be harvested their entire lives, and they will never have truly valuable output. How can they eventually become wealthy?

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The first major pitfall is called “Mindlessly Joining the Crowd.”

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The online hype is even greater; you can even brew yourself a cup of tea, strike a pose, and watch. Oh! Vanke had an incident! Oh! Wu Yifan had an incident! Oh! Zhao Wei had an incident! Oh… These people are now called “melon-eaters” (gossip watchers) online. Compared to those watching on the roadside, online melon-eaters turn joining the crowd into a farce—a group of people who are inexplicably watching, and as they watch, the watchers start arguing with each other, attracting even more people to watch… It is said that curiosity is the source of creativity. Look, in fact, everyone has abundant curiosity. Unfortunately, it is all wasted on watching inexplicable hype. However, this is also right…

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The second major pitfall is called “Hastily Following the Trend.” Suddenly, a certain “trend” appears. For example, the recent “Content Entrepreneurship,” or last year’s “O2O”… Something is hot! Instantly, a large group of people (in fact, always the vast majority) hastily rushes to follow the trend… But they forget that whenever a major trend appears, there is always another group of people who were already prepared—even if they weren’t intentionally prepared. If content entrepreneurship is truly a trend, a major tide, then the group of people who have been writing for ten years before this are clearly “unintentionally but inevitably the most prepared.” The people who just started rushing to follow the trend, how can they compete with the other group?

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The third major pitfall is called “Over-caring about Others’ Hearts.”

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—A phrase: You are like a weak Bodhisattva, unable to cross even a small river, yet you worry excessively about others’ hearts. Truly, what are you aiming for? If someone fails in their business, you won’t suffer a loss, but if they succeed, you are afraid, aren’t you?

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Money is not the most important thing because it can regenerate; time is also not the most important thing because it essentially doesn’t belong to you. You can only try to be friends with it and make it work for you. Your attention is the most important and precious resource you possess—viewed from this angle, life is actually fair, because your attention is something you can control, unless you give it up yourself. Therefore, whether the outcome is good or bad is truly up to you.

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Attention

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This might be the most valuable advice in life—because, ultimately, all your value is the output of your attention. Moreover, more critically, a person’s attention is likely the only resource that can be called “innately produced.” Think about it, what else is like this? … So, where should you put it? The answer is clear and unique: put it on “Growth.” There is a Silicon Valley “cliché” that is actually very meaningful: “Entrepreneurship is growth. Without growth, it is not entrepreneurship.”

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If you want to take a step further, you can try listing the following (this is not homework): 1. Review what you have been paying attention to? List them and judge whether those things are related to you? Are they related to your growth? 2. Review what you have been paying attention to last week? List them? Judge whether those things are related to you? Are they related to your growth? 3. Review what you have been paying attention to last month… I know you can’t even remember it?

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In a sense, advertising is actually this kind of business model, isn’t it? You can study the major marketing accounts on Weibo; they are best at “attracting attention”—another way of saying “harvesting cheap or even free attention.” Then look at how many people are even “actively contributing their attention,” and then you can understand why this business model can ultimately achieve “long-lasting prosperity.”

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If you dare to ignore your attention, your attention (in fact, your attention is the truly valuable you) will be ruthlessly harvested and sold.

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People who don’t cherish their attention are destined to be poor in the end, because they will be harvested their entire lives, and they will never have truly valuable output. How can they eventually become wealthy?

01.20160805 Our Most Important Wealth is “Attention” ★

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Keywords: Compounding Effect, Key to Happiness, Individual Value 1. When some people ask why their schedule is packed yet they still feel they have no gain, I remind them: the packed thing is your time; the idle thing is your attention; the wasted thing is your growth. 2. Put your attention on your own growth. Put it on all skills that can have a compounding effect, and then give them sufficient learning, thinking, and refinement. 3. Put your attention on true love without expecting return; this is the key to true happiness. 4. Put your attention on things that truly contribute to society. Individual value equals one’s social contribution rate.

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The wasted thing is your growth.

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Reasons for falling into the three major attention pitfalls: For most people, short-term pleasure is more useful than long-term gain. It satisfies the personal sense of security, belonging, and achievement.

02.20160812 Paying is Picking Up Bargains ★

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1. What bargains have you picked up by paying in the past period? Not just this channel—this channel is definitely excellent value, without a doubt. 2. In what areas have you wasted time and attention where you could have picked up bargains in the past period? 3. How many times in the past period have you been in a bad mood all day because of an argument with family? 4. If you need continuous attention but are repeatedly disturbed, have you thought of any effective countermeasures? 5. In what areas have you ignored the value hierarchy of assets, to the point where you suffered a big loss?

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What resource is most important? (Attention) What resource is more important? (Attention > Time > Money)

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Many people comment, saying they don’t know what to do with their attention. O Accumulate knowledge O Refine skills O Observe life O Think about the future O Create value O Manage relationships

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Things to guard against.

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So, I have long since invented my own method: always set the phone to silent, and turn off all push notifications. When I am focused on working, I should not accept any disturbance. When I stop and rest, I can handle the unread messages and missed calls.

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Because overall, paying money to buy time is more cost-effective!

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The best way to make others approach you is to occasionally do something admirable.

03.20160819 The Heaviest Shackles of Life are “Security” ★

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1. Almost all progress is achieved by giving up some security. 2. Pursuing 100% security will definitely trap you in the eternal present. 3. We must give up some security to observe and think deeply in the long term. 4. Don’t cooperate with people who lack security—because in their world, a true cooperative relationship is practically impossible. 5. Regarding reading, put your attention on how to apply the knowledge gained to improve your life.

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Most people are like this: they pay attention to everything around them at all times, and they are very afraid of missing something. They cannot concentrate long-term, nor can they think deeply long-term; their attention is always focused on every event happening around them. Such people have no past, and no future; they don’t even know that they could have a past and a future. For them, there is only the present, without comparison.

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Ultimately, this can lead to being trapped in the eternal present.

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In a sense: almost all progress is achieved by giving up some security.

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…rather, it is to pursue the security of “not being left behind by the times.” Believe it or not, look around and see how many people are pursuing 100% security. They are constantly attracted by everything happening around them; they cannot observe or think deeply in the long term about anything—this might not be their nature, but rather that they themselves are unaware of the limitations of this survival mode—they are like those animals, trapped in the eternal present.

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One of them is not taking risks.

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What is cooperation? The essence of cooperation is that everyone gives up a small part of their security and entrusts that part of security to the partner. What is trust? Trust is believing that the other party will not exploit the part of security you voluntarily give up.

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The so-called lack of security is actually the disbelief that others can exist without exploiting the part of security you give up. Therefore, they can only secure 100% security themselves—this is truly an exhausting state, isn’t it? If you know the root cause of people’s lack of security, you will understand why this advice is correct: don’t cooperate with people who lack security—because in their world, a true cooperative relationship is practically impossible.

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100% security brings 100% constraint.

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Your time and attention are fleeting; try not to waste them on rapidly depreciating information.

04.20160826 The Foundation of Life: “Having a Future” ★

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• In the long term, the output rate of mental ability is definitely higher than the output rate of physical ability, and by many orders of magnitude… • The glass ceiling for physical ability is obvious, but where is the glass ceiling for mental ability…? • The time for physical decline comes very early, but the time for mental decline comes much later… • The massive profits gained through brute force are decreasing, because in the major trend, knowledge is more likely to generate greater massive profits…

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Don’t expect to be right in one go.

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What is called investment is nothing more than exchanging current resources for future resources.

05.20160902 How to Meet a Benefactor ★

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Belief combined with patience is what can help you endure accidental setbacks and wait for inevitable good fortune. Often, what hinders our action is not our own ability, but the wrong concepts in our minds.

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1. Optimistic people are more likely to become benefactors to others; 2. Benefactors are more likely to meet benefactors; 3. Those who can help others progress are true benefactors; 4. Excellent people, respected people are more likely to receive help; 5. People who are willing to share are more likely to receive help; 6. People who don’t burden others are more likely to receive help; 7. People who are not ashamed to ask for help are more likely to receive help; 8. When asking for help, it is not appropriate to rely solely on money as compensation; when helping others, it is not appropriate to charge money in return; 9. A benefactor doesn’t have to be a genius; a genius is often just focused on themselves, but a benefactor is different; they often value “harmony over everything” and better understand “the noble one is better than many noble ones.”

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…the noble one is better than many noble ones. 10. Often, people’s success comes from a large number of people hoping to see them succeed. Conversely, if a large number of people are unwilling to see someone succeed, then this person will find it difficult to receive the so-called “help of benefactors”; 11. People who are doing the right thing are more likely to receive the help of benefactors—this is what “many help the worthy” means; 12. People who live in the future are more likely to meet benefactors, because others can see the future in them.

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…not “asking for help.”

06.20160909 Regarding “Capital” ★

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Capital is indeed mainly composed of money, but just a pile of money placed there is definitely not capital.

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In an investment environment, earning 50% profit with 10,000 RMB as capital, versus earning 15% profit with 100,000 RMB as capital, the former performs better than the latter, or to be slightly more professional, the former has a higher capital efficiency than the latter.

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The fundamental reason they buy junk stocks is because “that thing is cheap.” They focus on absolute value, so even if a stock has high profit potential, as soon as they look at the price and “feel it’s too expensive,” they turn and leave.

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In other words, a person with an annual income of 60,000 RMB, who allocates 5,000 RMB as investment capital and “sentences” this capital to a life sentence, will actually, with a high probability, not affect their quality of life.

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One of the secrets to acquiring wealth is not taking risks. Giving up security allows you to have more energy to focus on specific fields, observe in the long term, and think deeply, rather than encouraging everyone to take risks.

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Becoming an outstanding investor is only a matter of time, first because they have started; and they are already “winning at the starting line,” because the initial act of “sentencing their own capital to a life sentence” has laid the most solid foundation for them to develop the ability to “think deeply about the future” later on. With this foundation, many techniques are unnecessary, many traps automatically disappear, and many helpless anxieties instantly vanish… I know you might feel that “life sentence” is both cruel and unnecessary—but this is the wisdom you must acquire: struggling to learn how to distinguish between…

07.20160916 Regarding “Falling Behind” ★

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1. Sooner or later, you will achieve the state of no longer selling your time for a living. 2. Sooner or later, you will achieve the state of not falling behind, becoming in the top 20%, or even the top 1%.

08.20160923 The Best Strategy to Move from Mediocrity to Excellence: “Multi-dimensional Competition” ★

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Often, comparison is a pitfall, a huge pitfall. To put it simply, comparison is a trap… So we must find a way to choose happiness and fortune that can be obtained without comparison—this sentence is revised from the original book text.

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On a single dimension, people compare length; on two dimensions, people compare area; on three dimensions, people compare volume.

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For example, if you want to memorize vocabulary. Don’t just look and memorize it; memorize it while looking, writing, and speaking. One dimension becomes three dimensions, and the effect is not just tripled, but at least much better than just…

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In the article “Paying is Picking Up Bargains,” I mentioned that to help my wife understand that “attention is the most precious,” I put a lot of effort into explaining various reasons from different dimensions, so much that it could be a book. So as long as you are meticulous, there are actually many areas where multi-dimensional play can have a huge effect.

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Furthermore, plan a path that is most suitable for yourself. If you don’t have a sufficiently outstanding dimension yet, then refine your skills well; if you are already excellent in a certain dimension, don’t get complacent with existing achievements; try to break through your limitations in a different dimension.

09.20160930 Understanding “Metacognitive Ability” ★

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Attention is the most precious wealth; paying is actually picking up bargains; 100% security might be the biggest shackle; living in the future is the only way to meet wealth; you must become a benefactor yourself to continuously meet more benefactors; it is highly likely that after 1%, you are falling behind; building multi-dimensional competitiveness for yourself is the way out;

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A person’s ability to create wealth is ultimately related only to metacognitive ability—everything else is a subsidiary factor.

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In fact, they don’t understand their own thought process, thinking principles, or thinking methods; and it is because most people have never seriously examined whether their thinking results are truly correct and reasonable.

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Your creation is almost meaningless unless you feel it has value; it must also be considered valuable by others, and the more “others” there are, the better; the more “others” there are, the higher your creative value—isn’t that right?

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The so-called high IQ is not just being able to solve a few math problems, but being able to perceive the principles behind those numbers. The so-called high EQ is not just being able to get along well with people, but understanding the other person’s deep-seated needs.

10.20161007 Methods to Improve Metacognitive Ability ★

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It is absolutely “indispensable” in life.

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…the result of the plan." And recognizing the source of emotions is calling upon metacognitive ability.

11.20161014 “The Master Key” ★

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Besides being attracted by various entertainment news and funny jokes, our attention is also attracted by another thing: the problems that trouble us. Solving the English listening problem: as long as you can say it, you can understand it. The more fields you are involved in, and the deeper you understand each field, the more likely you are to find more and better keys. The best way to move from mediocrity to excellence is “multi-dimensional competition.” When practicing the concepts learned now, you need to give up some existing security and focus your attention on the current method.

12.20161021 “Persistence” and “Perseverance” ★

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No matter what you do, before you start, try every possible way to give this thing great significance, even multiple great significances.

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Wow, this isn’t something a human can do?! Then, I spent an afternoon pondering if there was a way to give the act of memorizing vocabulary great significance. Soon, I thought of one. Passing TOEFL/GRE and getting a high score, then teaching at New Oriental—it is said the annual salary is a million RMB. So… one word is equivalent to 50 RMB. How satisfying! Originally, I planned to start by memorizing fifty words a day to adapt for a while. Thinking of this, I immediately decided, no, the first day must earn 5,000 RMB! This happened many, many years ago. Can you imagine the feeling of earning 5,000 RMB in one day in that era?!

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A person who has the concept of “speed reading” will never know that they haven’t gained anything from reading, not because they read too slowly, but because they never seriously thought about it.

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Learning without thinking is the same as not learning.

13.20161028 “Missing Out” ★

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The pleasure of reading gives people an illusion that they have understood the content of the article, and life will automatically become different. But that is just an illusion. If you cannot recall what you actually read, then these words are not very meaningful to you. Ultimately, you will only remember that you once read similar reminders after going through a detour.

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…system, mobilizing all senses to create “immersion” for yourself, to ponder, to research, to imagine. If this concept is absorbed by yourself, what should you become?

14.20161104 This World is Alive ★

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Many things that objectively do not exist, because a subjective concept exists, they seem to “exist truly”…

15.20161111 Completely Quitting “Complaining” ★

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The worst habit to completely quit is this: complaining. Keep a record of your complaints to urge yourself to quit complaining. Change what can be changed, accept what cannot be changed—this is the prerequisite for our life’s happiness. The harm of complaining is not just wasting time, nor is it just exposing your incompetence; its true harm is that it makes you involuntarily give up the struggle.

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If you can solve it, solve it (ability); if you cannot solve it, endure it (resilience); and then observe, you will find that the vast majority of people lose in the first layer—ability; and in the second layer—resilience—they never make even a tiny bit of progress.

16.20161118 Seeing Others’ Goodness to Gain New Life ★

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One morning, I listened to someone explain a principle to me, and I thought, “Wow, so amazing!” That afternoon, I listened to another person explain a different principle, and I thought again, “Wow, so amazing!” Lying in bed at night, I suddenly realized that the fundamental principles behind what these two people said were contradictory…

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You can actually learn a lot of good things from those “people you might have disliked.” Even more astonishingly, because you can see more and continuously see the goodness in others, the world you live in is indeed much better than before… I always involuntarily wonder, how much actual goodness have I missed over the years? And if I missed it, I can only blame myself.

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I don’t like Fan Deng, maybe it’s just that I’m jealous of his ability to easily trick people out of money.

17.20161125 The Value of Correctness Itself

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It is easy to follow the crowd, but difficult to make an independent judgment. To defy the mainstream view and make an independent choice, you need not only courage but also intellect. This is a task that is both mentally taxing and exhausting, so naturally, it is not easy to be popular. This hits the majority of “performance players.” Because they only care about whether it looks good, and whether it is good, they don’t really care.

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“Listen to the majority, reference the opinions of the minority, and finally make your own decision.” This is a very wise principle—here, “listening to the majority” does not mean just “doing exactly what they say,” but “listening to how they say it and pondering how they think.”

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See how the donkey thinks.

18.20161202 What Determines Your Destiny ★

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1. You discover a need that needs to be met but has not been met; 2. You have a very strong need for it yourself; 3. You ask the people around you, and they all say they have this need; 4. There is no product on the market that meets this need; 5. If you create it, you will be the first to do so, so you definitely have an advantage and a promising future… This is a very common line of thought, and it is the hardest idea to convince—because every sentence seems right, and when put together, it seems even more right… But, is it really? “I have a strong need” and “the whole world has this strong need” are vastly different.

19.20161209 “Self-Motivation”

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“Learning English” is fundamentally not a hard necessity for the vast majority of people. Many people think learning English is important because the people around them think so. For the vast majority of people, passing the English exams is the true hard necessity. This also proves why so many people, after taking the CET-4 and CET-6 exams, never touch any English-related material again, even if they constantly say English is important. In fact, whether it is English, fitness, or any other skill, if it cannot affect your life, you cannot feel its necessity. Believe it or not, look back at the wishes you made at the beginning of the year; are there any items missing that would not affect your life? Since it is not a hard necessity, it is “not necessarily needed,” so in fact, “it’s okay if it’s not needed,” in fact, “it’s fine if it doesn’t exist,” although “it’s pretty good if it exists,” but “if it doesn’t exist, at most there will be a little resentment”…

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“Making excuses” is a hard necessity. Or rather, making excuses is a habit. Whenever you encounter difficulties, you can always find various reasons immediately to convince yourself to give up. This habit, or hard necessity, is a major pitfall. If you look into the pit, you will find countless people struggling below.

20.20161216 Cognition, Selection, and Cultivating the Right Hard Necessity ★

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Eagerly wanting to change the status quo. The worse the status quo is, and the less accumulation there is, the more eager you are. Because of this accumulation, no one can magically create it, so when faced with the extremely uncomfortable choice of “either accept it” or “start accumulating from now,” a considerable number of people finally choose to “take a risk.” In fact, many principles have very simple explanations, but because they are too “familiar,” we ignore them. At this time, we need to use reasonable metaphors to make them catch your attention again. For example, don’t rush to change the status quo, which is somewhat like “don’t try to escape gravity.” As long as we live on Earth, you cannot escape gravity.

20.20161216 How to Cognize, Select, and Cultivate the Right Hard Necessity

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In the eyes of performance players, this world only has “success” and “failure.” There is no intermediate state between them. In the eyes of ambitious players, they know that success and failure are just momentary states; between them, there are countless transitional stages, which is what we call “growth.” So, for performance players, if they cannot succeed, it definitely means failure. Therefore, when they see no hope of success, they usually choose to give up. But ambitious players are different. They know that besides failure and success, they have another state: continuous growth, continuously approaching success.

21.20161223 The Hard Necessity of Investment is Risk Aversion

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Following the crowd is easy; you don’t need to think, just entrust your brain to the masses. But you also cannot enjoy the benefits of being “unique and correct.” In fact, this applies not only to investment and finance, but to all aspects of life. We have always emphasized the preciousness of attention. The attention we save through various means is ultimately used to improve our judgment. Improving our professional ability, learning how to reasonably avoid risks—these are the things that require the most attention.

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How to distinguish whether you are “watching a fool take a risk,” or whether you are being treated as a “fool in the midst of risk”? Here is a simple and straightforward standard: Can you clearly state the “basis for action”? If your basis is merely “everyone is doing it,” “everyone thinks so,” “I got a small piece of news,” etc., then the probability of you becoming the “fool” observed by others is high. People with independent judgment can always provide a clear basis, even if it is not correct every time, but it can be corrected through feedback.

22.20161230 Respecting the Difference in Capital Scale

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But the difference between people actually arises from this choice. For you, the true hard necessity in life is whether it is “making excuses” or “finding methods,” which will greatly affect your future.

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Of course, they will also practice; they just avoid the obvious pitfalls, so the efficiency of achieving goals is relatively much higher.

24.20170113 Conditions to Start Investment Activities

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Here are a few small points: 1. In fact, whether the stock you start tracking is GAFATA or not doesn’t matter. If your English is poor, then choose a company on the domestic stock market that you believe has the potential for continuous growth—because in the coming time, you will be idle and need to pay attention to this company’s financial reports and other news. 2. The amount must be set to 1 RMB—that is, the most convenient and smallest unit. 1 RMB, 1,000 RMB, 10 million RMB, or whether it is USD or RMB, it doesn’t matter. It’s not because it’s “just virtual investment,” but because from the start, you must develop the habit of focusing on relative value rather than absolute value—the growth rate is what truly matters. 3. Update the data only once a month, and during the rest of the month, absolutely do not look at the data. Not only is it meaningless, but the scarier thing is that it will form a bad habit—you will understand how terrible that bad habit is later on. (Further self-training: If you break the rule even once, and can’t resist looking at the data before the end of the month, you must find a way to appropriately punish yourself…)

24.20170113 Conditions to Start Investment Activities ★

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If you can’t learn English, don’t learn it; just use it.

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Most people focus on “What do I want,” while only a few people think of “What do I have” simultaneously.

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Never mock others. People who have truly done something well will not mock others, because they know how difficult it is to do something well.

25.20170120 Can You Accurately Predict Stocks?

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It is precisely these differences in common sense cognition that determine whether some people are gambling, while others are investing.

26.20170127 Greed and Temptation ★

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“Financial freedom” is a tangible goal: not worrying about food or clothing, and no longer having to sell your time for living—that is the taste of freedom. Don’t worry about others’ hearts; put your attention on your own growth.

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Definition of financial freedom: Starting from a certain moment, no longer needing to sell your time for living.

28.20170210 What Does “All In” Mean?

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What happens after “going all in” has been repeated countless times in every corner of this world’s history. Before the moment the result appears, you think it is an act of “courage,” but the moment the result appears, it suddenly seems “so obvious, so undeniable, and so foolish”…

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A 60% chance of winning, investing 20% of your total assets, is essentially “going all in”!—

28.20170210 What Does “All In” Mean? ★

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To avoid that biggest risk (no more opportunities from then on), as an investor, you must remember and absolutely not violate the iron law: never go all in!

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No more opportunities from then on. Applying the phrase often used by gamblers—“try every possible way to stay at the table!” Because once you are eliminated, once you leave the table, there are no more opportunities. The ancient Chinese saying, “As long as the green hills remain, there is no fear of running out of firewood,” actually means the same thing.

29.20170217 The Simplest Safe Investment Strategy is “Fixed Investment”

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Fixed Investment Strategy: Regularly purchase a fixed amount of a certain (or several) growth stocks. Suppose, based on various reasons, according to your knowledge and judgment, you finally choose a certain stock, and you believe it is a “growth company.” Then you can start acting: set a deadline, which can be weekly, monthly, or quarterly; when each deadline arrives, regardless of the stock price change, purchase the same amount of that company’s stock.

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If the fixed investment strategy is so effective, shouldn’t everyone do it? Then why do so few people actually adopt and implement such a simple and effective safe investment strategy? A simple phrase, “most people just can’t endure it,” doesn’t give much essential interpretation. If we have the ability to penetrate the surface and see the substance, we will find that the key to the fixed investment strategy is not in “regularly,” nor in “fixed amount,” nor even in “long-term persistence in the fixed investment strategy”… Where is the key? The key is: before starting, you gain a fairly certain conclusion through in-depth research: this is a company with extremely strong growth potential… Because, your return = company growth potential x fixed investment strategy utility. If the company’s growth potential is actually zero, then the utility of the fixed investment strategy is equivalent to zero; if it is ultimately proven that the company not only didn’t grow, but actually declined, then the utility of the fixed investment strategy is effectively equivalent to magnifying the loss.

29.20170217 The Simplest Safe Investment Strategy is “Fixed Investment” ★

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When you enter a new field, the fear brought by ignorance is one of the difficulties you must face. At this time, you only need to tell yourself: just hold on for a few more days, read it a few more times. You will find that the unfamiliar things become familiar, and the unclear concepts slowly become clear. When you look back after enduring this stage, you will see that you have grown a lot.

32.20170310 Doing Normal “Time Trading”

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…people who willingly give their time. And the “giving” here often refers to those people for whom you are willing to spend time and energy to actively connect and maintain friendship.

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Friends are those people with whom you are willing to spend time and energy to achieve at least one thing together.

33.20170317 Regarding “Writing” ★

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The idea of execution is just an illusion. “Writing something useful to others,” this is the ultimate skill of writing; nothing is more important than this.

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This is certainly a good method, but it has its own limitations. Because not everyone is willing to give you the opportunity to explain it; after all, others’ time is also precious. At this point, “writing” becomes the best way to practice this idea. First, you don’t need to rely on others to complete the process of “teaching others” alone. Moreover, during this process, you can continuously refine it without worrying that the other party will be impatient. Second, after the article is published, you can receive real-world feedback. Believe me, as long as you explain it clearly enough and it is truly useful to everyone, the world will give you corresponding feedback.

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The idea of execution is just an illusion. So, in the end, even for the vast majority of the minority 5%, some are just illusions.

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Continuous writing is likely the most direct and lowest-cost way to train learning ability, thinking ability, analysis ability, and communication ability.

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“Writing something useful to others,” this is the ultimate skill of writing; nothing is more important than this. Just this one question filters out the vast majority of writings in this world.

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When I am ready, I will… I have seen many people say this, but few actually prepare and accomplish the task. In fact, many people use “preparation” as an excuse for their procrastination. For example, in writing, every article you write is preparing for the next article.

34.20170324 Factors Determining “Your Price” ★

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Never mistakenly assume that price and cost are directly and completely related; they are only indirectly related. Think about it, people pay money to buy a product because they truly need it, not because the production cost of that product is high—this is obvious, right? You have a product; before I buy it, all your costs are irrelevant to me, and your sentiment is also irrelevant to me.

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Oh my god! I worked so hard, I was so diligent, but why am I so miserable?! Maybe it is ruthless, but it is a fact: this world doesn’t need you.

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How do you become more valuable? — The answer is simple! Become a truly useful person. Just a moment ago, you might not have paid much attention to this sentence: generating a strong connection with this world is the most fundamental way to enhance life satisfaction. Have you realized it now? Why are a few people clearly happier than the majority, and why is their level of happiness so much higher? The explanation is simple: they have a stronger connection with this world…

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Since “being useful to others” is the most important thing to me, during the writing process, I even gave up the vast majority of rhetoric, leaving only two indispensable types (analogy and parallelism), because “writing style” is not important to me at all, because it is not important to the reader. For my readers, the most important thing is: the things they read are best able to bring them change (another way of saying “useful”)—not to mention rhetoric, sometimes for the sake of “truly being useful to the reader,” I am willing to directly give up even the legendary “simple and clear structure,” even if it is considered verbose, even if it is considered repetitive—because some important points need to be clarified, understood, and done well through repetition. Over these years, I have clearly known the great benefits and happiness that this value system has brought me. Let’s gather slightly…

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1. What is their (theirs) true need, and what is the most needed? 2. Am I the person who can meet their needs? 3. If I can, is it possible to become a necessity? 4. If I cannot, how can I? 5. Is it necessary for me to meet this need?

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Often, choice is more important than effort. Because if you choose the wrong direction, no matter how hard you work, as long as no one needs you, your labor results will not be recognized.

35.20170331 Regarding “The Method of Choice” ★

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—No matter who makes the choice at any time, they must face an uncertain future, so even if the choice is sufficiently correct, it may not succeed in the end, but the probability of success is higher, this is obvious, right?

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Many people are at a loss when faced with choices, partly because they lack clear values, and partly because: they are unwilling to bear the consequences of the choice.

36.20170407 Regarding “Growth Rate” ★

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Businesses that satisfy basic needs; businesses that can make money (beyond basic needs); businesses that can grow (more and more surplus); businesses whose growth rate can continuously increase (this includes a concept that many people never think of: growth rate)…

37.20170414 “Improving the Growth Rate” ★

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Many people mistakenly think that optimistic people are not anxious. In fact, that is not the case. Optimistic people are also anxious, but when they feel anxiety, they use metacognitive ability to distinguish a fact: “spending time being anxious” itself does not solve the problem. So, they look for solutions, and then put their attention on solving the problem, instead of just worrying about the problem…

38.20170421 Regarding “Knowledge” ★

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Knowledge itself cannot create value for us; only when its existence changes our choices can its function truly be realized.

39.20170428 Regarding “IQ”

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The so-called IQ is actually “the ability to solve problems.” (It doesn’t have to be “the ability to solve problems immediately”; “the ability to finally solve problems after long effort” is also a strong ability, which is essentially a sign of high IQ…)

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Frequently taking time to “put oneself in others’ shoes” and think from others’ perspective (temporarily shifting the focus from oneself to others) is definitely a quick way to improve “IQ”… Of course, many people call this “EQ,” but personally, I don’t think this concept is necessary.

40.20170505 Regarding “Quick Learning” ★

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The process of mastering any skill—the key lies in: 1. Starting this process as soon as possible; 2. Completing this process as soon as possible.

44.20170602 The Cheat Code of Life: “Learning Ability” ★

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Being able to learn things taught step-by-step; being able to learn skills taught in books; being able to learn skills that no one can teach…

47.20170623 “Smart Time Trading” ★

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There is a sum of money that is not small, which you absolutely do not need, and this is a basic indicator of financial freedom. Passing on the knowledge you have learned to others is a dual upgrade process for your personal business model. Giving this matter great significance, even multiple great significances. Not only do you need to understand others, but you also need to understand the entire world composed mainly of others. Although upgrading your personal business model is important, don’t rush to achieve it; you can first set the goal of solving your own hard necessity.

48.20170630 The Best Personal Business Model ★

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What is the method of growth? There is almost only one answer: learning. In a meaningful life, there seems to be nothing more important than these two words. Mastering every skill is empowering yourself, giving yourself stronger ability. Having more skills means having more dimensional energy. The reason humans can progress, the reason they can grow, is because of learning ability; even in my world, I unify learning, progress, and growth into…

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Since your goal is “to eventually no longer sell your time,” your action should be “to find a way to reasonably and gradually reduce the amount of time you sell”; and the method is “when you can exchange money for time, try to exchange money for time”; and then, all the saved time is “invested” in your continuous evolution…

50.20170714 Applying “Principles” to Make the Right Choice at Critical Moments ★

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Always choose to encourage others and never publicly argue with them; believe that trial and error is often the only path to progress; believe that “teaching” is the best way to learn; maintain patience in the long run to see the final result; do it first, then speak, instead of speaking and not doing.

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How to make a high-quality choice? 1. Before choosing, add and filter the necessary conditions; 2. When choosing, strictly filter using those conditions.

52.20170728 Regarding “Execution Power” ★

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…process, no one can skip. If you know how to do it, just do it. If you don’t know how to do it, of course, you must learn it! Learn it and then start doing it; if you can’t learn it, then you should have continued learning… But the vast majority of people choose to “let it go” here. There is an even harsher, more frustrating situation: you know exactly how to do it, even every step is clear, but you just don’t do it; or you don’t want to do it, but it’s not today, it’s tomorrow? The most frustrating situation is this: you did do it, you did it, very early on, but you just didn’t continue doing it…

A Critical Problem Takes up Too Much Time If a problem can be solved quickly, people either solve it the moment it appears or they set aside some time to do the work in a batch later, without feeling like it’s a waste of time. If that is the case, the problem is not really critical. Only when you need to spend considerable time and effort each time you solve the problem will it be impossible to “just” deal with it. “Doing it later” also turns into a chore, as it may take hours or days to deal with a long queue of deferred problems. A critical problem will feel like an unwelcome chore: important, yet tiresome.

There was a sizeable market with an apparent, shared, and critical problem. The problem was solvable, but no one had yet built anything to make it noticeably easier.

Who am I helping? You will discover how to find the perfect niche and make sure it can support your business in Step One: Your Audience. Why do they need help? Learn how to find and validate their critical problem in Step Two: Their Problem. How can I help them with that? Find a good solution and make sure it fits into your prospective customers’ workflow in Step Three: Your Solution. What can I create to help them that way? You’ll learn how to create an easy-to-maintain and reliable product in Step Four: Your Product.