Rules for Better Thinking, How to Reduce Blind Spots, & More | Shane Parrish | The Tim Ferriss Show

Added: Sep 29, 2023

Parrish begins by sharing his upbringing as a military child, constantly moving and changing schools. He reflects on how this transient lifestyle influenced his behavior and decision-making, particularly during his teenage years when he was involved in delinquent activities. He credits a chance encounter with a book about bank robbers called "The Stopwatch Gang" for steering him away from a life of trouble. This book sparked his interest in reading and became an outlet for him to escape his challenging environment.

The conversation then shifts to Parrish's experience working for an intelligence agency, specifically the NSA. He discusses the rigorous vetting process he went through to secure the job and the challenges he faced in a high-pressure and secretive environment. Despite feeling unprepared at times, Parrish learned to navigate the complexities of decision-making and leadership by observing and learning from others within the organization.

Parrish also delves into his fascination with mental models and cognitive biases, particularly in relation to the work of Warren Buffett and Charlie Munger. He explains that while cognitive biases can help explain past mistakes, they are not effective in preventing future errors. He emphasizes the importance of positioning oneself to make better decisions by avoiding bad circumstances and always being prepared to take advantage of opportunities.

The conversation touches on the impact of moving on children and how it can affect their development and social interactions. Parrish suggests that until grade seven or eight, moving around may not have a significant impact on children's lives. However, in high school, consistency and stability become more important for their academic and social well-being.

Ferriss and Parrish also discuss the value of challenging oneself and the role of failure in personal growth. They share personal anecdotes about their experiences with failure and how it shaped their perspectives on success and resilience. They both agree that being challenged and occasionally failing is essential for developing the skills and mindset needed to overcome obstacles and achieve long-term success.

The conversation continues with a discussion on decision-making and the importance of being in a favorable position to make better choices. Parrish explains that being in a good position means having the right circumstances, resources, and mindset to take advantage of opportunities. He applies this concept to various aspects of life, including finance, relationships, and personal well-being.

The episode continues with a discussion about the importance of being well-prepared and putting oneself in the best position possible. Parrish shares a story about a student who didn't get a good night's sleep and didn't study properly, resulting in a poor performance on a test. He emphasizes the need to think about life in terms of doing the best one can in each moment, rather than just focusing on the desired outcome.

Parrish and Ferriss then discuss the concept of mental models, which are frameworks that allow individuals to see problems from different perspectives. Parrish explains that mental models help reduce blind spots and cognitive biases by enabling individuals to adopt different personas and consider alternative viewpoints. He suggests asking questions like "How would Tim Ferriss think about this?" to gain a different perspective on a problem.

The conversation then shifts to the topic of building a business based on content and advice. Parrish explains that he initially started Farnam Street as a means of learning from others and sharing their ideas. He discusses the various components of his business, including the website, podcast, book series, and online courses. He also talks about the challenges of building a business on content and the importance of staying platform-independent.

Parrish and Ferriss then delve into the topic of automatic rules and policies. They discuss the benefits of having predefined rules that turn desired behaviors into default behaviors. Parrish shares examples of his own automatic rules, such as working out every day, investing in an index fund every month, and not scheduling meetings before 12 pm. He explains that these rules help reduce decision fatigue and create consistency in behavior.

The conversation continues with a discussion about the importance of win-win relationships and the need to avoid win-lose or lose-lose scenarios. Parrish emphasizes the importance of trust in relationships and the value of creating rules that promote fairness and mutual benefit. He also highlights the importance of staying on a timeline and compounding relationships over time.

The discussion continues with Tim asking Shane about the concept of "comms overload and brain damage" that can occur when people become overwhelmed with communication and decision-making. Shane emphasizes the importance of focusing on one or two things and doubling down on them. He suggests that building an email list is a key focus for reaching and communicating with an audience, citing James Clear as an example of someone who does this well.

Tim shares that he also has a large audience for email and finds it to be a valuable tool for communication. He mentions that he uses his weekly newsletter, 5-Bullet Friday, as a diary and enjoys looking back on past issues. Shane agrees and adds that email allows for a more timeless and evergreen form of content that can continue to work for you even when you're not actively working.

When asked how he would double down on email and long-form content, Shane explains that he would focus on creating useful and timeless content that people find valuable. He emphasizes the importance of cumulative and compounding effects, as well as finding a niche audience that resonates with your content. He advises against spreading oneself too thin and trying to do everything at once.

The conversation then shifts to investing, with Tim asking Shane about his approach to investing. Shane explains that he uses the cash flows from Farnam Street to invest and takes advantage of the deal flow he receives as a result of his platform. He focuses on investing in companies that are making money or that he understands well. He also mentions the importance of diversification and being in a position to take advantage of investment opportunities when they arise.

Tim shares that he is currently in the process of de-risking his investments and moving towards safer options. He explains that he wants to optimize for sleep and reduce the stress and complexity that comes with high-growth investments. He acknowledges that this goes against his conditioned way of being, but he wants to experiment with a different approach for a few years.

The conversation concludes with a discussion on decision-making. Shane suggests that the key to making better decisions is recognizing that you are making a decision in the first place. He emphasizes the importance of managing emotions, focusing on outcomes over ego, and thinking independently. He also highlights the value of writing as a tool for improving decision-making and thinking more clearly.