If You Want to Succeed, Please Understand the First Principles.|ManualTrader

If You Want to Succeed, Please Understand the First Principles.

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The only cornucopia in this world is to learn how to manage wealth + insight into investment + see the long-term effects. Indeed, the three concepts of financial management, investment, and medium-to-long term are not difficult to understand, but most investors think of fragments. They think about financial management, or think about investment. Therefore, the first point is that these three concepts must be connected together to be a complete solution. For example: How can we change ourselves to a rich head? When encountering something new and unfamiliar, it may be a good way to be curious and collect as much information as possible without taking a stand. It's like, when it comes to Bitcoin, many people's defensive hearts immediately become very heavy, and they will say that it is a scam, that it is a money laundering tool, or that they are not interested in understanding at all. When encountering these new changes, we can close the window immediately. Afterwards, if things are as we guessed by intuition, we can always show off and say: "Haha, look, I'll tell you" What did you earn? You earn a sense of superiority in IQ. But you close an opportunity at the same time, what if you are wrong? Your loss is more than just not having the superiority of this IQ. You might miss the greatest technological advancement of mankind since the Internet was invented. If you miss the Internet technology explosion like I did, then you should remind yourself not to miss web 3.0 again.

The basic course of financial management needs to change the thinking in your head. For example, I often ask a customer a question during a guest talk meeting. Suppose you are still a college student. Hourly shift, after seven days of work, the boss will give you 2000 red envelopes. After New Year's Eve, your parents will also give you 2000 red envelopes. On the first day of the new year, I want to go out to play with my classmates. The red envelope on the left hand side is earned by your part-time job, and the red envelope on the right hand side is given by your parents. Which one should you spend first? Many people instinctively first spend the package their parents gave, after all, they can't bear to spend the money they earn from working hard. But in fact, the value of the two packs of money is the same, and you should be equally cautious.

Investment truth told by a century of history.

Thinking about starting to invest is good, but thinking about earning a part-time job or lunch money from the stock market every day will make you go from investment to speculation in the end. Investment is to put money in assets that can increase in value in the long-term, while speculation is to make short-term operations to make the difference. After putting one dollar for two hundred years, now there is only 0.05 yuan left. The gold has become 3.12 yuan, and the stocks are 1.03 million yuan. This is what the statistics of the past two hundred years tell us that we must put money on truly worthwhile investments. I liked "Die Kunst über Geld nachzudenken" by the German stock god André Kostolany so much that when I later sorted the bookshelf, I found that I had two translations of different years. There are many classic sayings, such as: "When there are more fools than stocks, never enter the market. Enter when there are more stocks than fools."

In addition, the story of the old man and the dog that everyone hears often comes from Kostolani, that is, "The stock is a person who takes a dog out for a walk. A person walks one kilometer. The dog usually walks four kilometers back and forth, but No matter how far you go, you will eventually return to your master.” What we are talking about here is that stock prices often fluctuate up and down very sharply, but they will eventually return to a reasonable evaluation position, that is, the fundamentals of the company. The farther the price is above the fundamentals, the higher the risk of this stock. When the price is below the fundamentals, the deeper the safety net you can grasp. Of course, the difficulty of actual operation lies in the control of the company's fundamentals and the depth of research. This is why Buffett hopes that you can define your competence circle. After all, our time and effort are limited, and we cannot pay attention to all opportunities. .

The first principles.

From the perspective of physics, "first principles" is a term in quantum mechanics, which means calculating from scratch, using only the most basic core facts, and then inferences based on this fact , Create new value. Elon. Musk once said in an interview that when he was developing Tesla electric vehicles, he had heard that many experts felt that electric vehicles could not be popularized because the battery cost has not been lowered in history, at $600/ Kilowatts are the public price of the market, and in the case of such expensive batteries, it is almost impossible to achieve the popularization of electric vehicles in a short period of time.

But Elon. Musk did not agree. After learning about the cover of the electric car, he dismantled the material of the battery pack itself and restored it to the most basic materials: carbon, nickel, aluminum, etc., and this reduction made him renew Understand the "basic facts" that construct battery manufacturing. In the end, he let the cost of the battery drop significantly and officially opened the first year of electric vehicles. The "first principles" thinking model was also used by Musk to think about the SpaceX plan. He also challenged the expert prejudice that "cost is so expensive" in the space transportation technology industry in the past.

The key point of the first principles is to break out of the existing framework, think about the most fundamental core of the problem, take the cocoon, actually solve and convey the most basic facts, to see what the value of this thing is to consumers, from this Thinking from a perspective can truly create value. Henry Ford invented the Model T, and for a time cars all over the world were made by Ford. His concept is very simple. In the era when horse-drawn carriages are still popular, if your client tells you that I want a faster horse, don’t you run to the Mongolian steppe immediately and see if you can help him. Find a sweaty BMW? But the real core of the problem is not what horse? It's the "what" he wants to run faster and farther. This "what" is what Henry Ford saw. The customer wanted faster and farther, not faster horses, and in the end he created the most popular car. Rewrite the history of human movement.

Going back to the beginning, what I mentioned, if you are willing to leave a window, I hope you will also think about it. In the case of Bitcoin, what are your first principles? What is the most fundamental core of Bitcoin's existence? The answer to this question, I think, is "censorship resistance", which means that Bitcoin is truly decentralized. Governments around the world have gradually realized that they cannot kill Bitcoin. No matter how you use coercive means, as long as the Internet exists, Bitcoin will exist. After thinking about this, you will know why other cryptocurrencies have gradually evolved into currencies or securities, and Bitcoin is gradually becoming the digital gold of human beings in the online world.

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