How to Live Safely in a Wall Street Universe
Epsilon Theory
April 1, 2019·7 comments·Money
Wall Street runs on Mob logic: everyone kicks up the chain, everyone's got a Paulie, performance is all that matters. But there's a moment that breaks this model. When someone has the courage to make a decision that could destroy everything, asking for your cut becomes the thing that destroys you. The people who understand this survive. The people who don't eventually get whacked.
- In ordinary business, the transaction is everything. You generate ideas, you negotiate your cut. You push for payment because the business IS about money. This is how people survive in competitive environments.
- But existential trades operate on different rules. These are the two or three moments in a career when survival is genuinely at stake, when someone's willingness to act when everything is on the line is what matters.
- The mistake people make is treating existential trades like ordinary ones. They ask for their cut, they expect credit, they apply instrumental logic to moments that demand something else entirely.
- What actually happens when you do this: You breed resentment that never fades. You signal that you saw them as a means to an economic end, not as an autonomous person worth supporting.
- The counterintuitive move is complete generosity. Cede the trade entirely. Give them full distance and full ownership. You don't get paid for the idea, but you get something more durable: a place in their pack.
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For me, the best part of sharing a winning idea is getting the opportunity to see who has the class to say “thank you”; not only does it give you the knowledge that it made even the slightest difference in someone else’s life, it gives you the knowledge of who you should give a damn about.
Thank you for sharing, Ben.
Thank you for explaining the difference and providing the terminology to articulate different types decisions. The fact that there’s a difference between tactical decisions, for example, what language should we write this piece of software in; strategic decisions, like what company should one partner with and existential decisions, which market segments will survive in the 21st century.
In my case, four years ago, I made an existential decision to leave a comfortable management position at a consumer retail company and make myself a developer in startup. My thinking was/is that CPG, Automotive, Retail, Consulting etc. market segments are full of zombies that when the economic winds change, will almost all be wiped out. So, if I wanted to succeed in the 21st century, I had to work in a company designed and built for the 21st century. Understanding wasn’t the problem, executing differentiated it as existential rather than strategic.
It took a couple years and a lot of retraining, but I am now a Sr. DevOps engineer in a Series A Startup. From this vantage, I can give you a second example. In any startup, there are lots of tactical decisions, what capabilities do we create, who writes them, etc. Two months ago, we made an existential decision to change our monetization strategy. Executing and leaving a comfortable paradigm are the issue, not understanding the decision.
Thank you for the definition and terminology to articulate what differentiates an existential decision.
So the 2019 idea is………?
I miss David and Harold.
Sadly this comment sums up my limited experience with ET. I consider myself part of the pack intellectually but am not a professional money manager and cannot afford the attendant fees that go along with full access. I have been trying to read between the lines on what the 2019 call is but it appears only accessible in the pro subscription. I harbor no ill will and understand the need to paywall the intellectual property rights but am disappointed in that I enjoyed access to Ben’s unfettered thoughts and those days are behind us. I will likely continue in a similar vein to what I do now with Doug Kass. I cannot justify the RealMoneyPro fee so I follow his twitter feed to keep up with his thoughts. He is pretty good about trying to articulate his thinking and trades there for folks like myself. The one downside is he is a bit obsessive on politics and gets frustrated with trolls leading to long twitter timeouts.
I understand this completely, damon33. Incomplete thoughts are frustratingly frustrating. Generic advice is available everywhere, but I’m here to hear ideas that might be relevant to my/our life and investment approach. Our primary authors come from a community not my own and they carry attitudes, biases, and intentions that need to be seen by the rest of us and evaluated as useful to us. I’m seeing, apparently not alone, the value decrease over time - but I will soldier on. Hang in there a bit longer and let us see how this unfolds.
Uhhhh - I miss my ex-wife, daughter, the old SF Chronicle, funded pensions, meaningful labor laws, taxation of all financial exchanges (oh, wait, that hasn’t happened yet), and my many Republican and LIbertarian friends who have left this damned domain before me so that I have no one else with whom to discuss or argue or fight over this stuff. Oh, well - sorry W.Petersen, miss whomever you miss. But if this isn’t your spot or mine, we need to think about what else might be.
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