One of the richest people I’ve had the chance to meet, even if briefly, was the CEO of the company I previously worked for. He was making around 4M$/year and obviously had very expensive tastes. He liked cars a lot, especially Bentleys, Porsches and Aston Martins, so he had one of each and a few others. He also had no idea what every day things cost.
One day that he was particularly busy, he asked his assistant if she could go out and get him a sandwich. After she agreed, he gave her a 50$ bill and told her to keep the change if there was any. We all laughed at this story, this guy had no idea, he was living in his own bubble!
Last week, on election day, I felt like I was being laughed at. No one had predicted this outcome, not the media, not the pollsters and certainly not me. I felt like the guy living in a bubble with no idea what the outside world was thinking.
The first step to burst the bubble…
… is probably to recognize that I live in one. I had however no idea that I was and wondered if I could ever had enough information to consider that a majority of folks would have voted for Trump?
I’ve reflected on a few points:
- Do any of my close friends have any significantly different political views than I do? I’ve thought about the 5-10 people that are the closest to me, including my wife, my college friends and some of my colleagues-turned-friends and we’re all pretty much on the same page politically. Answer is no.
- Do any of my colleague have any significantly different political views? Maybe surprisingly, the group of roughly 10 people I’ve talked to in the office have similar political tendencies. Maybe it’s part of the company culture. So answer is no.
- Do I get my news from sources that have different opinion? I get my news mostly from The Economist, Yahoo Finance and TheVerge (yes I’m a little bit of nerd) and in most cases their views only reinforce opinions that I already have. So answer i no to this one too.
- Do any of my contacts on social media have different political opinions (Twitter, Facebook)? Maybe I’ve already muted them / unfollowed them, but what I see is that social media is an amazing echo chamber. It’s probably too easy on social media to get only news that we want to see and reinforce our opinions. So no to this one as well.
- Is my entertainment supporting different views? I like to watch John Oliver, Trevor Noah and Stephen Colbert on Youtube, it’s entertaining but they also have similar political views. Books I’ve recently read have been finance oriented and I’ve probably picked them because I liked the topic already.
I’ve come to the conclusion that I do in fact live in a bubble and it’s probably pretty thick. I can’t change my friends. I can’t change the people I work with. Changing my entertainment and social media followers is probably not going to happen, because well, I just want to be entertained. The only thing I can reasonably do to create more diversity of opinion is where I get my news from. But that wouldn’t be particularly natural.
I’ve realized that I completely underestimated what I don’t know. Especially since I’ve lived in that environment for a long time.
Knowing what we don’t know
Take personal finance as an example.
When I started to track my finances 10 years ago, I had absolutely no idea what I’d do with that. I just had a feeling this would be a good idea. But I knew that I didn’t know anything.
The longer we’re in a bubble, the more we forget how much we don’t know.
Now after almost 2 years writing thousands of words about it and reading hundreds of thousands of words about it, I know a little more. I have sometimes thought that there wasn’t much anymore that I didn’t know. How arrogant!
One day, I may even decide to try to time the market (and fail). I forgot that I didn’t know what I didn’t know. It’s a good example of the curse of knowledge and it can lead to very misinformed conclusions.
My CEO was used to paying 100,000$ for cars and he probably had over half of million worth of them. He was too busy making millions to know the price of a sandwich. To him, a 50$ sandwich or even 100$ was probably a fair price. To everyone else, it was absurd. It would have been pretty difficult for him to know how much it actually cost, he probably had not bought one himself for years!
The Bubble Effect
If you’re reading this, and even more so if you write about money, chances are that you are reaping the benefits of the current system. You are probably pro-trade and pro-globalization. You have most likely achieved more than your peers and you will continue to do so because you’re looking for financial independence.
Eventually, if not already, you’ll be part of the 1%. In income, in net worth or in people retired at your age. And it will become increasingly difficult to understand how the rest of the population can’t be financially independent too. It’s so simple after all.
I’ve forgotten that I live in my own bubble.
But at that point, the rest of the population could be 99% of the population. Even if your life appears ‘normal’, it will be part of a very thick and tiny bubble, where the 1% lives.
The result of the elections last week surprised me, probably because I’m a product of the current socio-liberal-capitalistic-pro-trade system. I’ve used it, I’ve benefited from it and it has worked for me. I have a natural tendency to support it.
But I’ve forgotten that I live in my own bubble.
A bubble that is getting thicker and smaller every day I get closer to FIRE. I’ve also realized that I as expand my knowledge in one domain (like finance), I also reduce it in other domains like pop culture (I haven’t watched TV for over 10 years now). The more I learn about new things, the more I realize that there’s an increasing amount of stuff that I don’t know anything about.
I think I’ve had it backwards for years. It’s not “the more I know, the less I don’t know”, it’s really “The more I learn, the more I realize about all the stuff I don’t know”.
Hopefully, I won’t grow my bubble too thick.
PS: If you want to evaluate how thick your bubble is, there is actually a 25 question test to evaluate it, check it out here on PBS, it takes a few minutes to complete. I got a measly 23 points.