I was crying in the hammock because of how stupid I was.
The hammock was in between two houses I owned. Two houses that had property tax liens on them.
Which means the State IRS puts signs all over your house in order to humiliate you.
I was about to lose both houses.
I kept thinking: I’m supposed to be smart. Why do these things keep happening to me? Why am I so stupid?
Only two months later I had no home, my family was far away, and I was crying on the floor of a hotel room.
—-
I have proof.
I was thrown out of graduate school. People ask me, “Why?” Simple: I failed every class.
My last class in graduate school: the final exam was to make a computer. We were given the task on Monday morning and had to demonstrate a working computer by 5pm Tuesday.
Everyone stayed up all night, took the test, which involved turning the computer on and off and doing some kind of math calculation. Everyone passed.
My turn. I turned it on. The computer short-circuited and died. FAILURE.
I walked home and I thought of my mom. I knew I was going to get kicked out. I knew she would cry. I didn’t know what I was going to do with my life.
That day my girlfriend also broke up with me. I was a loser.
The first day of Spring every year I go to the park.
For 32 straight springs it’s like a reunion. All the old faces and some new.
Playing chess at the tables they reserved at six in the morning at the park. Taking on all the kids and tourists who they could beat them. $5 a game.
I’ve watched these people age.
Drugs, homelessness, dental anguish, horrible diets. The friends that I was closest to have become a hopeless mess.
At least two are dead. No known reason. And two more are about to die.
They are genius chessplayers. They are homeless.
One day I was day trading and I had a bad day. And I just got so sick of it. So sick of the despair and the anxiety and the depression.
I went to a small little island near where I lived. Nobody was there. There’s a little beach.
I walked into the water with my clothes on. I floated. I wanted to be baptized by something.
I wanted to stop being a victim. Stop blaming a government or a market or a person. Stop being angry.
To be kissed by the sun and have my life change.
It didn’t. But I finally said, “I don’t care”.
I don’t care if people think I’m smart. I don’t care if a lot of my once-friends now hate me. I don’t care if the people who claimed to love me had their own agendas.
I don’t care if I once had money and now I was broke. I don’t care if I disappointed a lot of people and a lot of people disappointed me.
Everything I’ve ever did has brought me to this exact moment.
I am not a victim. I am the hero of my story.
And then I started to care again.
- A) TURN PROBLEMS INTO SOLUTIONS
- B) SCALE THE SOLUTIONS
- C) PLUS, MINUS, EQUAL
- D) LIKABILITY
- E) HAVE A UNIQUE VIEWPOINT
- F) FOCUS ON OTHER PEOPLE’S AGENDAS
- G) ANGER = FEAR DISGUISED
- H) DIVERSIFY STATUS HIERARCHIES
- I) HAVE A UNIQUE VIEWPOINT
- J) BORROW FROM THE 10,000 HOURS
- K) NEVER REGRET
- L) WORK HARDER THAN EVERYONE ELSE
Oh, and none of this works for me unless I am doing my “daily practice” of:
1% improvement every day in:
Physical Health: Eat, Move, Sleep.
Emotional Health: Eliminate the toxic people in your life.
Creative Health: Write down 10 ideas a day. In six months you will be an IDEA MACHINE.
Spiritual Health: Surrender on the things you can’t control.
I’ll explain the rest:
A) TURN PROBLEMS INTO SOLUTIONS
I was a horrible investor. I lost about ten million dollars from investing and went broke in the early ’00s.
Every day I stared at my stock quotes. I’d lock the door. I’d just stare.
I’d try to figure out how to kill myself so my kids could get my life insurance policy before they were old enough to remember me.
It’s very hard to kill yourself without hurting yourself. If you throw yourself in front of a train for instance, the train might drag you along, rip off half your face and a leg, and then you wake up alive.
If you thought you had problems before…
So I solved my problem.
I read over 200 books on investing. Biographies of every great investor (Baruch, Buffett, Soros, etc.), Books on every investing strategy (options, arbitrage, value investing, growth investing, day trading, venture capital, quantitative investing, biotech, etc).
Books on the psychology of investing. Novels about investing (“The Coffee Trader” by David Liss was the first. I remember writing to the author to tell him how much I loved it and his sincere response thanking me because I was the only one to write him).
Books on statistics so I could accurately program a computer to invest for me and so I could understand concepts like “multi-collinearity”, curve-fitting, and other enemies of the statistical.
I loaded in sixty years of stock market data. I used my background in artificial intelligence and now investing. I wrote software from scratch.
I was up about 100% a month that year. It saved my life.
Other problems: a relationship doesn’t work out. I never blamed the other person.
I’ve had every bad thing happen to me in a relationship. I’ve had the cliche happen to me.
But perhaps the worst was when a woman said, “I have to run some errands, be back in an hour” and she drove to the airport, took a plane to another country, and I never saw her again.
I am not a victim.
Sometimes people have different values. Sometimes things just don’t work out. Sometimes I was too needy. And sometimes I was cruel.
But I finally started saying to myself: what are my values in a relationship? And what values am I looking for?
Every relationship, I adjusted: what value did I miss? What value do I now realize I have?
Here’s where I am at: Integrity, Loyalty, My Age, Has to Have Kids (people who don’t have kids are great. But, as a father, I need someone to understand the billion subtleties of raising children), has to have been through real tragedy, horrible tragedy, and understood that tragedy is not the same as victimhood.
Has to be open-minded. Has to be able to handle free speech. Can’t be signed up for “groupthink” i.e. join the team (are you “left” or “right”?) or be hated.
Has to like me.
B) SCALE YOUR SOLUTIONS
When I started a hedge fund, I was horrible at raising money. I was a good investor at this point (at least, my track record was, and still is, great).
But I don’t like the process of convincing people to give me money. It’s frustrating.
You sit down with a potential investor and they immediately have huge status over you.
One guy said to me, “I can’t believe you have the balls to meet with me and you don’t have a business card, your hair is uncombed, and your dressed like… this.”
He had white hair, clean ruddy skin. Has fought his way up the ladder to the top. He had a bright red sweater. Bright, bright red like fresh blood. And he was as disgusted with me as I felt about myself afterwards.
Another time a famous investor said to me, “I’d love to invest with you but I can’t trust what you do with the money. And here at Bernard Madoff Securities, we can’t afford to say our name in the newspaper.”
So I used my “idea muscle” to scale in other ways.
I began to write about investing. I built up a completely different source of income writing about stocks for thestreet.com, The Financial Times, the Wall Street Journal, and six books about investing.
I made a website about investing called Stockpickr and sold it for $10 million (which I lost later (stupid!) but that’s another story).
I became a spokesperson for Fidelity about investing and made a decent living speaking for them 10–20 times a year for about eight years.
I started investing small amounts in angel investments that turned out well (about 80% / year returns since 2007).
I created courses and newsletters to help other people invest better.
I’m not saying I was smart.
I’m saying I turned a problem into a solution. (bad investor → I figured out how to be a good investor and put in my 10,000 hours).
And then I scaled it to find multiple streams of income around it so that the death of one stream would not kill me.
I own a comedy club.
The reason: I loved stand-up comedy for 20 years. I used to go to the Luna Lounge on Ludlow Street every Monday and see Marc Maron, Janeane Garafaolo, Amy Poehler, and many, many others perform at the starts of their careers.
I’d go all the way to Aspen and watch the young Dave Chappelle, Louis CK, Jack Black, and many many others perform.
So a few years ago I started performing stand-up 3–4x a week or more.
It’s the hardest thing I ever learned. It’s so difficult. So many micro-skills I had to master. But that’s another story.
I wanted to scale my interest.
I bought the club.
I helped the club expand their own sources of income. Creating video courses about comedy. Creating a “Laughpass” to get comedian fans special access in comedy clubs all across the country. Helping an ad agency which uses our access to comedians to create viral videos for brands. Making comedy specials that I could potentially sell.
And getting more access to the comedians I can learn from to fuel my own interest in getting better.
Find me at Stand Up NY doing an hour of comedy on December 25.
How do I scale my “solutions” in relationships?
Communication. It doesn’t matter if a relationship is with a romantic partner, a business partner, a child, a friend.
If we disagree, why do we disagree? Listen to the other side. Find out all the options in the middle. Figure out which option seems best. There’s always an option that works if you take ego out of it.
There are always options. That’s scaling.
C) +, -, =
I want to learn something. Investing, Chess, Comedy, Business, Sales, Software, Poker, Writing, whatever.
PLUS:
Find a mentor to help me get over bad habits. To show my latest experiences (e.g. videos of my latest stand-up appearances).
EQUALS:
Find the people striving with me. We’re in the trenches together. We’re not so good we can’t see the weeds. We’re in the weeds. Exchange notes, ideas, fears, frustrations, and talk them through.
MINUS:
If you can’t explain what you do, you don’t know what you do.
And sometimes the questions from people who have true “beginner’s mind” will expand my knowledge in ways I could not have guessed.
This is the most important learning technique I’ve ever discovered.
I wish I knew “+, -, =” when I was 27 and starting a business. When I was 30 and investing. When I was 36 and starting another business.
I finally figured it out around 40.
It’s a miracle drug for learning.
D) FOCUS ON OTHER PEOPLE’S AGENDAS
Nobody cares about me.
They don’t care about my goals.
An employee might want to eventually start her own business.
A romantic partner might also want financial security.
A potential boss might want to get enough credentials to get a better job.
A teacher might want help in another area of his life that you are expert in.
My life changed when I realized that I had to offer, offer, offer with no prospect of anything in return.
People will only turn to listen to you when you have something they want to hear.
Even if it’s friendship.
This sounds sad but it’s just reality.
E) LIKABILITY
“I hate myself,” I told a therapist. “I’m always pretending to be nice so my clients will like me.”
My first business was making websites. Almost every website for big corporations was run by people who either wanted a bribe, a job, or wanted you to do something for nothing.
But if they liked me, if I went on vacations with them, if I donated to their charities, if I played with their kids, if I helped them with their job problems, then I’d get the job.
“I feel like I’m always wearing a mask,” I told her.
One guy would call me at three in the morning every day crying about his relationship with his boss.
People never hired my company because we were good. Maybe we were and maybe we weren’t.
They hired me to be their friend.
So I had to be likable.
But this was like living in hell. The big realization:
Only work with people you legitimately like and want to be friends with. Then it’s much easier to be likable.
Then a customer turns into a partner.
F) HAVE A UNIQUE VIEWPOINT OR NO VIEWPOINT (Corollary: never read the news).
The other day I met President Clinton. I played in his annual poker tournament. Then we spoke for awhile.
I posted this picture on Instagram. I lost 100+ followers within an hour. People posted, “Okayyyyy….DELETED.”
What?
Just a few months earlier, the Libertarian Party of NY wanted me to run for Governor.
And another friend of mine asked me if I wanted to work in the Trump Administration.
I’m for Freedom. Not a political party. Or a personality.
I don’t care about 99.999% of political issues. And I don’t like groupthink, which is the entire reason political parties exist.
But we live in a world where free speech has been stripped from us by both sides of the political landscape.
People on the left won’t say that there are subtleties to pro-choice and pro-life. People on the left won’t let you point out what hypocrites they are on climate change.
People on the left will make you say “they” instead of “he” or “she”, not realizing that identity politics led to Stalinism. (Read “The Gulag Archipelago” to see the direct parallels.)
People on the right won’t let you talk about government help for people in need. Won’t let you talk about raising taxes. Won’t let you talk about Israel or Palestine (and, to be honest, I forget which side is for who).
I finally started to have a unique perspective when I realized the only important thing to me was:
Physical health, emotional health, creativity, and spiritual health.
And that by focusing every day on those four things would let me have a far greater voice in helping people than any one political issue.
Everyone else is just yelling from their air conditioned suburban homes with comments (“!!!!”) on Facebook.
Mastering yourself is the only way to help be the pebble that drops in the ocean and ripples its effects to all shores.
I thought I had free will. That I made my own decisions. That I had my own viewpoints.
But suddenly you realize that we all see 65,000+ marketing messages a day for a reason.
That there’s a reason most people believe in the beliefs of their parents, or their culture, or the region where they were born, or of the professors who taught them.
We don’t have free will. We’re basically irrational and (just to say it) stupid.
At least I am.
And I fight that tendency every day. It’s difficult.
G) ANGER = FEAR DISGUISED
I was angry at my oldest kid. I’m sorry, Josie.
All the times I tried to convince you to not go to college.
Even offering you, in cash, your entire tuition if you spent the semester living with me.
But maybe I was just afraid to miss you as much as I do. And maybe I was afraid that if I “let” you go to college (not that I had a choice) then people would call me a hypocrite for my own stance on college.
But I know I was afraid. And I know I should never have been angry at my little baby.
And when I was angry at “XY” for wanting to go to a party without me. Maybe I was just afraid you would cheat on me.
And when I was angry at a boss for giving a job to someone else, maybe I was just afraid you didn’t like me anymore and wouldn’t promote me.
Fear is closer to the heart than anger is.
Fear is closer to the solution.
H) DIVERSIFY STATUS HIERARCHIES
I used to think self-worth was net worth.
I wouldn’t say it that way. It’s stupid to admit that. But it’s how I thought.
I’d wake up and before I kissed my kids I’d check my online bank statements and add up what I was worth. On days when it went down I’d be too afraid to look.
Then I’d think my self-worth was similar to the status of whoever I was dating.
When I was a kid I thought my self-worth was equal to the college I went to.
Or later, the “likes” I got on a Facebook post. I’d actually feel sick if I didn’t get enough likes in the first hour after a post.
I’m an idiot.
But I can’t help it. I’m a tribal animal. Every primate ranks themselves in their tribe from alpha to omega. It feels horrible to be omega or heading in that direction.
I came up with a solution: I diversify my idiocy.
If I lose money one day, I call my children (I’m a good parent!). If they don’t answer maybe I’ll go play chess online (I’m a winner!), or go onstage and perform stand-up comedy (I make people laugh!) or check in on angel investments (I’m gonna be rich!).
Immersing in different subcultures allows me to learn. Allows me to bring ideas from one subculture to another (try this: doing stand-up comedy for a year and then public speaking in front of a group of bankers. You will DESTROY the crowd).
And it allows me to focus on things I love when other things I love are not going as well.
I don’t know if this is the right way to deal with things. I’m no expert. But it works for me, keeps me constantly learning, and constantly feeling a sense of community, mastery, and freedom.
I) BORROW FROM “10,000” HOURS
Wally is a ping pong champion. One of the best in the US. We play ping pong in NYC.
But yesterday I visited him in Venice Beach, CA. He was playing paddleball against the world champion. He was doing well.
On a break he came up to me, “I just started playing paddleball.”
I asked him, “Do you think you borrowed skills from ping pong?”
Of course!
Maria (author of “The Confidence Game”) has gone from zero knowledge of poker to a substantial winner in the past year.
She does the “deliberate practice” described by Anders Ericsson in his studies on “The 10,000 hour rule” (the rule that says 10,000 hours of deliberate practice will make you the best).
But she is only at about 1,000 hours.
“I’ve borrowed from my 10,000 hours of observing people for my books. Many professional poker players don’t have that.”
When I started doing stand-up comedy I had no experience. I was just a huge fan.
But I borrowed from my 10,000 hours of writing (sometimes humorously), public speaking, and other types of performance.
I don’t know how many hours I skipped. But I skipped a lot.
When I was getting better at investing, I borrowed from my computer science skills, my skills at entrepreneurship, my analysis of my failures, etc.
You don’t need 10,000 hours.
The key is: divide a skill into micro-skills (e.g. entrepreneurship = sales, negotiating, marketing, management, execution, etc.).
And then figure out where you DO have the most hours.
Borrow, beg, and steal from those hours.
J) NEVER REGRET
Regret makes you time travel to the past. Anxiety makes you time travel to the future.
You only have NOW now. Don’t flush it down the toilet of your time travel machine.
K) HAPPINESS = REALITY / EXPECTATIONS (OR… PROCESS > OUTCOMES).
If I’m 300 pounds and I want to be 150 pounds I might be unhappy because I am far from my goal.
I can’t change reality today but I can change expectations today.
I can say, “I worked hard at improving my life style and I know that if I do this every day I will achieve my goals.”
Suddenly I am happier, because my expectations became much lower as to what I needed to do TODAY.
A friend of mine messed up a deal she was in.
She cried every day for about a month. I tried to tell her not every deal works out. In fact, most don’t.
But if you improve your process (sell the deal elsewhere, improve your network, improve what you are selling) then you will get the outcome you want.
Outcomes are castles in the sky.
Process is what I can do today to achieve greater connection, mastery, and freedom.
L) WORK HARDER THAN EVERYONE ELSE
TJ Miller (actor/comedian on “Silicon Valley”, “Deadpool”, and of course “Yogi Bear 3D” and the “Emoji Miller”) told me after the podcast he was going to perform at seven different comedy clubs THAT NIGHT.
He pulled out his calendar and showed me each club and time.
“I can’t believe people think they are owed something when they don’t work harder than everyone else,” he said.
“They think they should get a role even though they never took an audition class. They think they will be a good comedian if they don’t get on stage as much as possible.”
He’s not the only one who has said this to me. Tony Hawk (world champion skateboarder), Garry Kasparov (world champion chess player), Sasha Cohen (world champion figure skater), and over 400 others have said the exact same thing to me on my podcast.
Maybe they are all wrong.
But I doubt it.
I don’t do all of the things above. Sometimes I have to keep my expectations low.
But just being aware of what it takes to be truly mindful and intelligent in a basically irrational world is what keeps me happy.
Why happy?
Because when I think I am “owed” because “I’m smart!” it helps me to see what the habits are that have truly catapulted me to any success I’ve had.
I’ve also been in the gutter at three in the morning being pulled out of an intersection before a car hit me.
Life goes up and down. But I want them to go more “up” than “down”.