Invest Like The Best #59 Grand Theft Life with Tim Urban
How Tim explains the idea of compounding: The Human Colossus is the collective knowledge humanity has built. The collective ability to create and invent. A mountain of achievement that is cumulative across generations. It is a force that is greater than humanity itself. This collective knowledge has grown substantially between 50,000 BC and today. And it is creating at a level we can’t even fathom. Humans are the same today as they were in 50,000 BC. It is this colossus of human knowledge that has grown/changed. (4:02)
Applications of narrow Artificial Intelligence: Human doctors analyze mammograms correctly about 80% of the time. The AI that is now analyzing mammograms is correct 96% of the time and does so instantly. Tim believes it’s going to be management malfeasance to have a company that doesn’t use AI. (11:45)
One of the most important ideas Tim has written about: Cook vs Chef. A chef invents recipes. A cook follows recipes. (17:13)
What he learned by studying Elon Musk: If you ask Elon Musk he would say you should reason from first principles instead of reasoning by analogy. A first principle is a basic assumption that can not be deduced any further. First principle thinking = think like a scientist. Reasoning by analogy is looking at what other people are doing and iterate a little on that. Reasoning by analogy is how most people do most things. (21:42)
How to spot a chef: The first principle for a chef is the raw ingredients. They experiment. They will fail a lot. Much more than people just copying. But every once in a while they will create something amazing. (23:31)
How Elon thinks about business: Most people when they start a business think that way (reason by analogy). Elon says well my first-principles calculation say it’s possible so I’m just going to go ahead and do that. Thinking like that makes you unbelievably different. (24:36)
Example of first principles thinking: Steve Jobs didn’t say what should our keyboard look like? He said what should a mobile device be. Let’s just think about that. And by the time he was done reasoning there was no keyboard and he created something new. Then everyone copies. (25:06)
How Tim decides what to write about: We are all just a photocopy of 100,000 other people. There are a lot of Tims out there. Who happen to be just like me, they happen to like the things I like. They happen to be interested in the same things I’m interested in. I judge by my own reaction to my own research. (33:36)
Elon is just doing the same thing over and over again: I analyzed Tesla, SpaceX, and Neurolink in depth. I thought about them forever. And I realized it's the same formula. He starts with his core motivation and then works backward. (47:00)
People mistake first principle thinking for courage and genius: When you look at what the most brilliant people do… a lot of it is just clearing human delusion out of the way. Use your simple logic and trust it. Suddenly you seem like you can do genius things. If you focus on what is actually true today, while everyone else is stuck in outdated conventional wisdom, you’ll seem like a genius visionary. (52:43)