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How to get rich without being lucky (2019)

• amelius 5y ago
  > Wealth is assets that earn while you sleep Rent seeking is not regarded very highly on HN.
  • deleted 5y ago
    [deleted]
  • nlitened 5y ago
    Most of active HNers are employed in rent-seeking SaaS companies
    • xyzzyz 5y ago
      “Rent seeking” has a specific technical meaning, which is not the same as “collecting rent”. Most SaaS companies are by no means rent seeking, and in fact it’s hard for me to come up with an example of one that does it.
      • edoceo 5y ago
        Ticket Scalpers - my favourite example of rent-seeking
        • thegrimmest 5y ago
          Aren't ticket scalpers enabled by artificially low ticket prices?
          • edoceo 5y ago
            Sorta. But their real m/o ("value add") is they aggressively purchase the "fruit" (best seats) which pushes out regular market-price buyers. Then hold. Then sell at 5x to 120x list price. Its a game, similar to equities but perishable. Their only real service is standing in line in front of you to corner and add pressure.
  • rexreed 5y ago
    Are you speaking on behalf of the entire HN community? I didn't realize we all spoke with one voice. If anything, the HN groupthink is counterproductive. I find that the true value of the HN community is the diversity of the voices and opinions here, not what "all of HN" thinks, which is not always correct (and often not).
    • fartcannon 5y ago
      I try to read comments that speak for a group like the parent has as this, "From my perspective a nonzero number of people on HN think..." Because in reality, it only takes a few undisputed replys or posts to make someone assume it's a ubiquitous idea.
      • rexreed 5y ago
        But as you can see from the responses to the GP comment, many nonzero people on HN think and believe the contrary. So, the comment attempts to impose on the reader the perception that any contrary belief to what the commentary implies is a "normal HN opinion" is something that should not be held with credibility. It's counterproductive to say that some non-zero group of people on HN believe something when a possibly equal or greater non-zero group believe something to the contrary. It makes me wonder if the point of the comment is to suppress contrary positions.
        • fartcannon 5y ago
          Agreed. I was just try to help with framing if it was bothering you. If instead you're trying to help make the site better, well, more power to you.
  • ashneo76 5y ago
    Rent seeking is how FAAANG companies make money. Secure the supply chain, low cost and cheap labor, fight right to repair, fight what does it mean to own a streaming movie and then charge exorbitant prices for services. They exploit people on both sides of their business: consumers and laborers
    • 0xbadc0de5 5y ago
      I find it interesting how many individuals appear to both love and hate FAAANG companies. They love the products but seemingly hate the fact that the companies exist. Would it not be equally fair to claim that both consumers and laborers also "exploit" FAAANG companies to their own benefit? Take Amazon as a single example - if not for the Amazon fulfilment centers, where else would these workers find employment? And if the claim is that it's such a terrible work environment, why not work somewhere else? Fact is, they are employed there of their own volition so clearly there must be some advantage over potential alternatives. Comparing Amazon to a hypothetical "perfect" employer is a straw man, a more fair comparison is to existing alternatives (including unemployment). Would it not be fair to also suggest that Amazon has, directly and indirectly, contributed to raising more people out of poverty than any other company in history? They have opened the global supply chain to everyday consumers on a massive scale. Because of this, one can now buy a 65" flat screen television for $500 USD - a price point within reach of many low income households and no longer considered a luxury purchase. And the factories where these are made are paying much higher wages in much better working conditions than existed previously. And they are continuously improving. Or consider AWS - this alone has enabled countless startups to succeed with virtually no upfront infrastructure costs. If AWS disappeared tomorrow, how many HN readers' jobs would be in serious trouble. How many newly minted millionaires owe their success, in some small part, to the services that AWS provides? The point is, this is a give and take situation. Sure FAAANG companies make money. Because we give it to them, voluntarily, because we have decided that the benefits they bring to us are worth more than the cash we exchange for it. If one has an issue with how any of these companies conduct themselves, the obvious response is to take your business elsewhere. If enough people agree, the business will adjust or a competitor will take its place. I don't personally care much for companies making it impossible to repair their products, but I'm also of the opinion that I can vote with my feet and with my money to help change that.
  • LoveMortuus 5y ago
    I don't think one should exclude a viable option for profit, just because of some poor actors. I think rent can be a beautiful way to earn profit and to connect with people. If you are earning with rent it doesn't necessarily mean that you're evil and that you're abusing your "customers" with unreasonable demands or unexpected surprises.
  • oogabooga123 5y ago
    Bearing risk is not rent seeking, passive income does not imply rent seeking
  • 127 5y ago
    There are different levels of rent seeking. For example I don't think there's anything wrong with loaning money for people who will use it to start a productive business. There's a lot wrong with corruption, where laws and politicians are bought with money. There's a lot of wrong with regulatory capture, where market regulation is distorted in a way that makes competition against the status quo next to impossible.
  • jl2718 5y ago
    I think the negative aspect of rent-seeking is not so much passivity, but the lack of value added.
    • marcosdumay 5y ago
      It's a very new phenomenon that those two things are different, and it is still the case that they only differ on very few, very small niches. But yes, that seems correct to me.
      • jl2718 5y ago
        I don’t think so. Somebody once had to build the houses that they were collecting rent on. Time passes and what used to be value added becomes a simple matter of capital invested or inherited.
    • Koshkin 5y ago
      Depends on what you mean by "value," I guess, but it seems to me that being an effective participant in market economy is impossible without bringing some kind of value to the table (if only indirectly or as a side effect).
  • 2ion 5y ago
    What a mindless comment. Realistically speaking, rent seeking is the only way present young and future generations are able to participate in economic "growth" effectively. The human population grows, but the chance to participate in the industries and locations with the highest ROI on human capital does not. In fact, wage stagnation and inflation have stunted ROI on human capital in many non-growth industries in developed countries already. In fact, in my country where given the current trajectory of public policy I will see a huge net loss in pension benefits despite paying into the system more than any previoius generation in real terms already, without rent seeking through investing, I would literally end up poor as fuck and a slave to the state and would never have a chance to stop working short of just dying. Rent seeking is how the current system works, get over it.
    • GoodJokes 5y ago
      What if, and hear me out, we changed the system so it isn’t the only way to accumulate wealth. You can walk and chew gum at the same time. At least I think so. One can decry immorality of rent seeking and understand it is a reality today.
• srameshc 5y ago
  > But the reality is everyone can be rich. Reality is everyone can not be rich. So this is pseudo philosophy, with all due respect.
  • LoveMortuus 5y ago
    I think "Everyone can be rich", extremely depends on your definition of rich. And that definition not only varies from person to person but also due to geography and other factors.
    • grey-area 5y ago
      It varies most over time.
  • ______- 5y ago
    Define rich? I've always loved the quote: Some people are so poor, all they have is money ― Patrick Meagher You can be rich and have poor taste, rich and alone, rich and never have the simple experiences of everyday 'poorer folk'.
  • pmorici 5y ago
    Believe he addresses this criticism thusly... “ At the same time, deep down many people believe they can’t make it; so they don’t want any wealth creation to happen. They virtue signal by attacking the whole enterprise, saying, “Well, making money is evil. You shouldn’t do it.” But they’re actually playing the other game, which is the status game. They’re trying to be high status in the eyes of others by saying, “Well, I don’t need money. We don’t want money.””
    • CJefferson 5y ago
      Just saying "disagree with me? Then you are just playing a status game" isn't a criticism, it's just making stuff up. The world is full of evidence that one of,if not the biggest factor on people's wealth is the wealth of their parents. It's incredibly hard to escape povity.
• enriquto 5y ago
  fuck being rich. I just want to be able to afford a small house to live with my family. If I saved 100% of my salary for a decade I still would't be able to afford half of it.
  • amelius 5y ago
    You don't work in IT, I suppose?
    • enriquto 5y ago
      I guess I do, but in academia (and in Europe). Is it different in the U.S.? How many years worth of a professor salary do you need to buy a house in a major city?
      • ericmay 5y ago
        It really depends on the city, but I'd say in most major metro areas in the U.S. average home price is going to be $300,000 or so.
        • edoceo 5y ago
          Zillow says Seattle is over $800,000. Can't find salary info for UW (the big university). Tech-folk making $150,000+
          • the_only_law 5y ago
            > Can't find salary info for UW (the big university). In most states the salaries of state employees (at least over a certain amount) are available. Since UW is a public school you should be able to find them here: http://fiscal.wa.gov/salaries.aspx http://fiscal.wa.gov/salaries.aspx Filtering by UW employees I can see at least one professor making $627k in 2019, and I imagine there are lower tier professors making a fraction of that (some associate professors making < $100k).
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• deleted 5y ago
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• Opt_Out_Fed_IRS 5y ago
  Did Naval steal this from Frank Underwood? "Money is the McMansion in Sarasota that starts falling apart after ten years. Power (or status) is the old stone building that stands for centuries" It's the same thing he's saying here, but like the guy Frank Underwood was talking to, Naval doesn't recognize that financial wealth is only more secure and fungible than social status if you can manage to move said financial wealth around before stuff hits the fan. So many examples to cite, ranging from Venezuela, to Zimbawe to Cyprus. And mind...stuff inevitably always hits the fan, when stuff hits the fan you want to have loyalists who'd defend you against your enemies. The whole reason why all investigation relating to Trump will end in a nothing burger. He has 75m people who follow him and the political cost of doing anything to him is simply too high. Also same reason why Musk can't be touched even though he violates the law every day, he has a huge cult following and the political cost of doing anything to him is again simply too high. Ideally you make money by lying low, then diversify (unless you are a hedge fund manager, in that case you are already diversified), then use money to build a following. I say ideally because you need smart people around to make money and smart people tend to be repulsed by people who are hyperfocused on building a cult following and a great social status (exhibit A : the turnover rate at Tesla)
• nonameiguess 5y ago
  Discussions like these seem to miss the critical difference between individually and socially rational incentives and behaviors. Surely, given you at least live in a place that is sufficiently secure and stable with liberal markets and access to capital, anyone can get rich by following in the footsteps of the investor class. It is definitely not the case that everyone can get rich this way. If all 8 billion people on the planet did nothing but shuffle around paper ownership claims, there would be nothing to actually own. For an economy to produce anything at all, the vast majority of participants need to be on the ground making stuff, with only a tiny vanishing few shuffling paper at the top to decide who gets to own the inputs and outputs. Maybe we'll actually reach some future where all production and maintenance labor is fully automated and most participants in an economy won't be human and we can just ethically enslave them for the benefit of human owners, but we're nowhere near that point. I'm living right now in a hotbed of construction, a rapid growth metro, and I'm in the middle of it. Three lots I can see from my bedroom window are being leveled and turned into townhouses. That work is being done by people. They certainly have machine work multipliers. Nobody is carrying lumber and stone by hand from quarries to job site. Nobody is leveling the earth with shovels and trowels. But the bobcats and trucks are still operated by humans. Pipe is laid by humans. Walls are erected by humans. If all those people tried to do my job instead and became coders, or worse, tried to become investors, I and all the investors would be left with nowhere to live because no one would be building houses. We'd have no water or electricity if no one was laying the pipes and lines. At some point, we should realize this and attempt to have an economy that recognizes most people in the economy have to be doing basic labor for there to be an economy at all, and figure out a way to accomplish this without these people needing to live paycheck to paycheck with the looming threat of a medical emergency able to wipe them out permanently. We can't just tell them to all change their focus from doing work to building wealth, because if they actually all do that, there will no longer be any wealth.
  • spfzero 5y ago
    I think you've pointed out the fourth kind of luck, as described in the article. The people building the houses, driving the Bobcats, have a skill they've developed over time through their effort, that now affords them employment. If you know how to do something, and someone needs that, they're going to call you up and ask you if you'd like to do that thing for some amount of time for some amount of money. So that ability is a form of wealth. I don't think he's talking about everyone in the world becoming passive investors; kind of the opposite actually.
• MrPowers 5y ago
  The book The Millionaire Next Door provided data to support "Seek wealth, not money or status". The book was written by finance professors who examined the characteristics of actual millionaires. They found a lot of people who appeared to be millionaires did not actually have a net worth over a million dollars. High status professional are expected to drive nice cars and live in a big house. It's harder to be a millionaire if you're spending a lot of money. The authors were surprised to find that a lot of the Americans with a net worth over a million did not fit any of the "millionaire stereotypes" at all. They drive an old pickup truck and drink Bud Light. I like the Tweet thread, but prefer the Millionaire Next Door cause it's backed up by actual data. It also seems like the Tweet thread is focused on advice that'll get you a net worth in the top 0.1%. The central premise of the Millionaire Next Door is a lot of people have "regular jobs" and get rich (depending on your definition of rich). See the janitor that amassed an $8 million dollar fortune: https://www.cnbc.com/2016/08/29/janitor-secretly-amassed-an-8-million-fortune.html https://www.cnbc.com/2016/08/29/janitor-secretly-amassed-an-...
  • throw0101a 5y ago
    > The book The Millionaire Next Door provided data to support "Seek wealth, not money or status". […] I like the Tweet thread, but prefer the Millionaire Next Door cause it's backed up by actual data. Fooled by Randomness by Nassim Taleb, most/more famous for Black Swan, pokes holes in the methodology used in TMND, specifically survivorship bias. Another observation from FbR: > I will set aside the point that I see no special heroism in accumulating money, particularly if, in addition, the person is foolish enough to not even try to derive any tangible benefit from the wealth (aside from the pleasure of regularly counting the beans). * https://www.goodreads.com/quotes/553605-i-will-set-aside-the-point-that-i-see-no https://www.goodreads.com/quotes/553605-i-will-set-aside-the...
    • lukas099 5y ago
      Taleb should know that the benefit is having f*k you money. I suppose that once said money is obtained, there may be no greater advantage in accumulating more.
    • 5y ago
• madengr 5y ago
  In engineering, its just as important to know what not to do. I am an expert at knowing how not to get rich.
• dataangel 5y ago
  > Humans don’t have that. I can cooperate with you guys. One of you is a Serbian. The other one is a Persian by origin. And I’m Indian by origin. We have very little blood in common, basically none. But we still cooperate. I'm not a geneticist and I'm having trouble conjuring the right search terms to find a source, but I seem to recall reading not too long ago that all humans are more related to each other on average than members of most other species, because we very "recently" (still millions of years) went through a near-extinction event, making our gene pool less diverse than most other species because everybody alive today comes from the few people that survived that event. So altruism in most animals is actually more impressive than altruism in humans.
  • Teledhil 5y ago
    Only 75000 years ago, but maybe the Toba eruption? https://en.wikipedia.org/wiki/Toba_catastrophe_theory#Genetic_bottleneck_in_humans https://en.wikipedia.org/wiki/Toba_catastrophe_theory#Geneti...
    • mkl 5y ago
      It may be way more recent than that, more like 3000 years: - https://en.wikipedia.org/wiki/Most_recent_common_ancestor#TMRCA_of_all_living_humans https://en.wikipedia.org/wiki/Most_recent_common_ancestor#TM... - https://www.sciencedaily.com/releases/2004/09/040930122428.htm https://www.sciencedaily.com/releases/2004/09/040930122428.h...
  • nine_k 5y ago
    Assuming that the Indian speaks Hindi, all three languages are Indo-European, assuming even closer historically recent ties.
• anigbrowl 5y ago
  The stuff about capitalism being intrinsic and status games being zero sum suggests a rather myopic view of society. Of course many economic exchanges are positive-sum. But it does not follow that this drive is universal; it just looks that way to people whose social circle consists of others engaged in the same virtuous circle. Nor does it follow that others don't get it or are playing zero-sum status games; there are different groups with different motivations. Research suggests there are 4 major groupings whose interests are only somewhat coincident: https://advances.sciencemag.org/content/2/8/e1600451 https://advances.sciencemag.org/content/2/8/e1600451
• pazimzadeh 5y ago
  The idea that there's no luck involved is pretty dumb.
  • snickersnee11 5y ago
    Well, we're assume there's a certain path you can take to maximize your chances, it will be too pessimistic to always take bad luck in account.
  • sergiotapia 5y ago
    There's most definitely luck involved, but a huge part of it is being prepared to capitalize on those lucky opportunities. Are you ready when the bell rings?
    • moate 5y ago
      And if the bell never rings?
      • sergiotapia 5y ago
        It always rings. The vast majority of people never volunteer, never want to be visible, never want to put in the work. The odds are in your favor that the bell will ring for you, just by reading this forum you probably read other interesting things. Most people just watch TV, it's crazy but it's true.
  • ne0flex 5y ago
    Depends on your definition of luck. Some people define luck has having the skill to take advantage of opportunities you come across. Of course, the skill thresholds to take care of opportunities varies significantly case by case.
    • developer93 5y ago
      Having the luck to be born into a place where you can acquire the skills to take advantage of or build opportunities is one thing, I don't think the skill itself is lucky.
• paulpauper 5y ago
  >But the reality is everyone can be rich. We can see that by seeing, that in the First World, everyone is basically richer than almost anyone who was alive 200 years ago. >200 years ago nobody had antibiotics. Nobody had cars. Nobody had electricity. Nobody had the iPhone. All of these things are inventions that have made us wealthier as a species. >Today, I would rather be a poor person in a First World country, than be a rich person in Louis the XIV’s France. I’d rather be a poor person today than aristocrat back then. That’s because of wealth creation. Ppl keep making this argument,and even though it is not wrong, rhetorically it is unpersuasive. People see the huge hospital bill, having to negotiate with insurers, tuition going up, bills unpaid, unrest and anger online and in poltics, etc. They feel like things are getting worse on a relative basis even if the iphone is more 10000x more advanced than a supercomputer 60 years ago. You cannot make such an assumption because the subjective 'you' cannot experience both at once or compare and contrast the two. Both have advantages and disadvantages: Being a king means more status but also possibly dying of an infection and only having 0g wireless. Higher social status means generally an improved well-being.
  • teachingassist 5y ago
    > Today, I would rather be a poor person in a First World country, than be a rich person in Louis the XIV’s France. I’d rather be a poor person today than aristocrat back then. A rich person also had access to near-unlimited amounts of human labour. Cleaning your house, cooking your meals, tailoring your clothes, nursing your children. There is a limit to how much that has been replaced by technology. An equivalent question is: Would you give up being a rich person in 2021, to become a poor person in 2200?
    • loxs 5y ago
      Also being able to procreate and reliably raise children (also with physical help from servants) is probably a bigger wealth enhancer, especially over generations. In our modern world, being poor means you are going to either not procreate, or suffer while doing so. An iPhone does not cure that.
    • webmaven 5y ago
• snickersnee11 5y ago
  There's is for sure some good advice, but most of this is just useless word play, which does not give you any directions, but gives you a false sense of "life and society understanding". If you don't know that reading and work makes you wealthy, you're a probably a fool. It's important to tell people they can unite and work towards common good of humankind, but you should not title it "How to Get Rich".
• msarrel 5y ago
  There's some interesting philosophical concepts here, but nothing really hacker newsworthy. This is just someone carrying on that we should be like him without telling us how. Does anyone else note the irony here that he says he is only interested in acquiring wealth, not in status, yet this whole article is really just advertising for his status?
  • paulpauper 5y ago
    yes, the only reason anyone cares what he has to say is because of his status
    • therufa 5y ago
      not necessarily. before his appearance on the JRE podcast I didn't know him at all (i know i live under a rock), yet i've found his ideas compelling. Although Joe doesn't invite nobodies for the most part, so i might be wrong to some extent.
      • paulpauper 5y ago
        you just explained it. joe rogan does not have nobodies. think of how many ppl write to him asking to be on his podcast. think of all the mail his producers get.
  • arkitaip 5y ago
    That's naval's entire thing. Just trite thinking packaged to inflate his own ego as a "thought leader".
• DistressedDrone 5y ago
  I was commenting about this earlier, here's a link to a study that says otherwise: https://advances.sciencemag.org/content/5/7/eaau1156.full https://advances.sciencemag.org/content/5/7/eaau1156.full Or rather, it says people who are advantaged (ie lucky) considerably underestimate the contribution of this advantage to their success, and overestimate their own contribution. On the article itself, the stated idea of status is truly naive if not delusional, and allows them to put anyone who disagrees with their idea into the box of "status game players, to be ignored". I'm not going to read the entire article, it reads like advice to people who don't need it (upper middle class people). I'm sure it must be comforting to the author, and upper middle class and rich people, but in reality there is no clear path from "poor" to "rich", or else everyone would be taking it. What I will say is they seem to understand that our economic system is irrational, and to take advantage of it seems rational. But an irrational system is also unfair, and I would rather people not praise this unfairness as "good". The author seems to be paying lip service to the idea of "ethics" while teaching people to abuse the system. And they dare to talk about "virtue signaling".
  • zpeti 5y ago
    I can guarantee you one thing, if you don’t try and complain about how only privileged people can do it, you DEFINITELY won’t get rich or be successful or whatever your metric is. If you try, you might fail, and you might fail because of things outside your control, and it won’t be your fault. But you might succeed. Your choice.
    • michaelgrafl 5y ago
      No one is saying only privileged people can be successful. Just that observation has shown that the odds are stacked against them. I would call that unjust, and thus would be accused of playing the status game. It's a toxic argument.
    • Xplune13 5y ago
      I agree. The act of trying itself opens you up to new possibilities which are just locked if one just complaints and do nothing about it. That's why trying is necessary. But that doesn't mean one should deny the fact that some things are entirely dependent on pure luck. In my opinion, the luck part starts even before you're actually born (your place/country of birth, family etc.). So, one should acknowledge the fact that luck too played an important role in their current wealth along with their own hard work.
• anotheryou 5y ago
  I'd really like to read the continuation of this thought experiment. Which skills, if any industry knowledge is part of it, what the first steps would be, how to balance financial security and entrepreneurship ect. "I like to think that if I lost all my money and if you drop me on a random street in any English-speaking country, within 5, 10 years I’d be wealthy again. Because it’s a skill set that I’ve developed and I think anyone can develop."
  • gspr 5y ago
    How about you are dropped onto one of those streets, with your skillset, but: You're a person of color. Perhaps with no formal education to get someone to even consider your skills. Maybe you're past your prime age-wise too. And look it. Perhaps you develop an untreated health issue after being dropped on those streets. Now try.
    • deleted 5y ago
      [deleted]
    • milansm 5y ago
      You realize that Naval is a person of color?
      • gspr 5y ago
        I did not, no. Thanks.
  • seoaeu 5y ago
    I'm very curious how the author imagines the beginning of that process works. Where does your first security deposit come from? How do you pass any sort of credit check? Your first paycheck won't come for a couple weeks, so how do you buy groceries?
    • anotheryou 5y ago
      I'd guess being a sales person from day one. Find someone to click together a website for. Worst case in exchange for food and shelter which the other side might have in abundance if providing that is their profession. I made a website for the italian restaurant downstairs once and basically had access to unlimited pizza. Sadly it was really bad pizza :((
• jayd16 5y ago
  Seems like the usual banal self affirmation post. No luck? The author admits themselves that they needed an able body and a good education, for example. Privilege and luck is simply assumed and ignored. Just another example of survivor bias looking backward and saying "I made it with no luck at all!" Its not a real introspection despite the spilled ink.
• abootstrapper 5y ago
  Pseudo intellectual garbage, and the tweets read like if Ayn Rand wrote fortune cookies.
• jcoq 5y ago
  This screed could be the keynote speech at a MLM conference.
• croes 5y ago
  So he invested in Clearview AI and wish.com. Thanks for that ... not. "Wealth is assets that earn while you sleep; it’s the factory of robots cranking out things." Yeah, robots for sure.
• 11thEarlOfMar 5y ago
  It is true that becoming rich requires luck. So does completing college, landing a plumbing apprenticeship, or learning how to race a horse. I see life like I see poker. You need to learn enough about the rules to know when the odds are in your favor, then make your bets to take full advantage of the odds. In life, raising your skills in specific and deliberate areas will improve your odds. Then, you have to have enough agency to make the bets. Is that a guarantee that you'll achieve wealth? Certainly not. But you can learn how to improve your odds, and then take actions to put yourself in that improved position, and then be persistent and attentive to your progress. Analyze, adjust, optimize. Persistence is the thing, and by persistent, I mean over decades. If you're a solid poker player, you can make money over time. You may or may not ever have the right luck at the right time to win a major tournament, but you can still make a living at the vocation you choose. It's the same in building wealth. Have a deliberate plan that his high probability, but be open to identify windfall opportunities, and make a bet if you see the odds are worthwhile. There were a few deliberate choices I made to grow wealth. Each also took some amount of luck to transpire: - Choice: I put myself through college. My parents couldn't help, I had to pay for it myself. Luck: There were state and federal loan and grant programs to help with the cost, or I'd never have finished. - Choice: I decided to major in computer science instead of music. Luck: My dad's advice was that I'd be able to afford a more comfortable life in computer science. He'd chosen music. - Choice: I made the choice to move to Silicon Valley from the Midwest. That's where technology seemed to happen first. Luck: The only way I could do that was by living rent free for 3 months with a friend in Santa Clara that I happened to know. - Choice: I intentionally asked by boss for more responsibility. Luck: The company was in a growing market and needed engineering leadership. Promotions and raises followed. - Choice: I developed a business plan to open a new sales/services office in a foreign country. Luck: I had spent a lot of time traveling to that country on business and made friends with the people who established the business based on my plan and hired me. It was a lucrative choice. - I chose a lifestyle that left extra $ in the bank each paycheck, and then invested that money. Luck: My partner happened to have conservative approach to money management, and I listened to her. Each step was about improving my odds. Once I determined what to do, I had to find a way to make it happen, even if it took other people's assistance in some way. Finding that assistance at hand was the lucky part. I just had to have the agency accept it and act.
• vincent-toups 5y ago
  This has a real "I've read Rand and I'm using cocaine" vibe.
  • redisman 5y ago
    This article seems to be mostly very mediocre social commentary. Reminds me of an angsty high schooler (who’s somehow rich and defending their position) describing their view of society
    • jlawson 5y ago
      Naval grew up poor in India.
      • lotsofpulp 5y ago
        I feel like a lot of the immigrants I meet from India are landowners there and not exactly the lower class. They all talk about having people to clean their houses and do their laundry. Not rich per American standards, but definitely people that have an option if their gambles don’t work out.
      • redisman 5y ago
        I mean he's defending his current status as a rich person.
      • bradlys 5y ago
        > Ravikant was born in New Delhi, India in 1974. He moved to New York with his mother and his brother, Kamal, when he was 9. He graduated from Stuyvesant High School in 1991.[6] He didn’t grow up poor in India. He went to Stuyvesant in NYC - one of the most prestigious high schools in the world. In another article: > His father was a pharmacist in India, but his pharmacist credentials were not acceptable to practice pharmacy in the United States. Both of Ravikants parents did clerical work in New York City after their move to New York City. Shortly after moving to New York City, Ravikant's parents split up, leaving his mother responsible for raising him and his brother for the majority of their childhoods. They weren’t poor. Never were poor. I don’t know if maybe a pharmacist in India is a worthless job that is comparable to a subsistence farmer but in the US, it pays pretty well. We all have different versions of poor but I think subsistence farmer when I hear poor - not the version I’ve heard from many people in India where if you clean your own house, you must be poor.
• mgh2 5y ago
  “Industry, thrift and self-control are not sought because they create wealth, but because they create character.” - Calvin Coolidge I think our generation is forgetting some fundamentals: money at the expense of anything else. The problem with this approach, is not only that it destroys character in the individual, but that it also scales externalities to the rest of society. Part of this narrative is sold by startup culture and technocrats preaching to "change the world", while in reality the majority is just chasing quick money. From FAANGs to VCs, they control the media that convince young people to do the same: Robinhood, GameStop, cryptocurrencies are just reflections of this epidemic. This article is as ignorant as it gets as it refers to a misquoted saying "money is the root of all evil". The real quote is "the LOVE of money is the root of all evil" (aka. GREED) "The vaunted American dream, the idea that life will get better, that progress is inevitable if we obey the rules and work hard, that material prosperity is assured, has been replaced by a hard and bitter truth. The American dream, we now know, is a lie. We will all be sacrificed. The virus of corporate abuse – the perverted belief that only corporate profit matters – has spread to outsource our jobs, cut the budgets of our schools, close our libraries, and plague our communities with foreclosures and unemployment." - Chris Hedges Americans are forgetting their values https://m-g-h.medium.com/why-we-are-dispensable-7a577eba4f3e https://m-g-h.medium.com/why-we-are-dispensable-7a577eba4f3e
  • redisman 5y ago
    That dream was scrapped for parts by Reagan et al. It’s ridiculous to blame the millennials- the first generation (ever?) in the US to be worse off than their predecessors economically.
    • mgh2 5y ago
      I agree, but is emulating the errors of our parents that corroded society the best solution?
      • davesque 5y ago
        But our "parents" are still largely in control? Wouldn't passing economic reforms probably be easier without a bunch of deluded boomers and gen Xers in Congress?
• TheOtherHobbes 5y ago
  This says something useful in among the stock nonsense - which is that wealth is not about what you own or how much you can spend, it's about personal freedom. The interesting corollary is that in a capitalist economy hardly anyone is free. You "win" freedom by buying it. And that's what wealth is really for. This is why "We're all rich now compared to people two centuries ago" is nonsense. We're not, because the odds are good that we're more or less similarly unfree, especially if we're at the bottom of the heap and working the proverbial two or three jobs. Owning an iPhone doesn't change the fact that our time is almost wholly owned by others. It's also why it's impossible for a majority of people to be free. Someone has to do the actual work that keeps the lights on and food in the shops. Most people won't do that work voluntarily, so there has to be social leverage - implemented with loss of freedom - to force them into it. And it has to happen. Passive investing is worthless when there's nothing concrete to invest in. Corporate entrepreneurship is useless if there is no activity to manage, control, and profit from. The exceptions to this are genuinely creative activity. Invention, innovation (to a smaller extent), and cultural creativity are all individually powerful and can be disproportionately valuable, socially and economically. Coincidentally, they also attract more than their fair share of parasitic activity which seeks to capture their value for the benefit of others. But more - some people need to have these differentials in personal power. They lean towards narcissism, and it's important for them to feel more powerful than others. They will never, ever allow an economic system which doesn't constrain the freedom of those they consider inferior. It doesn't matter if it's run by machines or AI or any other magic technology. It's fundamental to their psychology to keep others in a one-down position, and they experience any threat to this as an unbearable narcissistic wounding. Inequality is not primarily an economic problem. It's a psychological issue - a public mental health issue, where the point of inequality is to allow unhappy rather damaged people to feel better about themselves. This is orthogonal to issues of building, researching, inventing, and generally getting shit done collectively. Without narcissistic friction all of those would proceed more quickly and smoothly, with astoundingly positive consequences.
  • musicale 5y ago
    > in a capitalist economy hardly anyone is free. You "win" freedom by buying it. Pretty much. > some people need to have these differentials in personal power Pecking order/social status is incredibly powerful for almost any social creature, regardless of its position in that order. Moreover, one of the most effective ways to make yourself feel better about your lot in life is to see people who are obviously much worse off.
• gricardo99 5y ago
  This reads like a parody. He’s trying to raise the status of tech entrepreneurs, painting it as the only truly virtuous endeavors, while literally saying he’s not into playing status games. But there are plenty of other gems in here too. Some come off like silly ignorance, others as callous or at least very tone def. You have a ton of parasites in you, who are living off of you. Umm, no I don’t. If you’re talking about micro fauna, that’s not parasites. Otherwise, Dude, you need to get that checked. It’s not about taking something from somebody else. It’s from creating abundance. But “disruption” inherently leads to winners and losers. There is a transfer from one group to another. Sure the end state may have more abundance than before but unless you address the disruption to those that lost out, you’ll have people, perhaps many, who feel left out, impoverished and distrust or despise the system. You can label them as “status” seeking haters of wealth creation, it’s a nice simple narrative, but divisive and counter productive to actually making the system work for more people and generate more wealth. Today, I would rather be a poor person in a First World country, than be a rich person in Louis the XIV’s France. You have no understanding of the plight of the poor and homeless in America. French countryside estate with a dedicated staff to provide for all your needs, or the homeless guy standing on the corner with the “hungry” sign? Of course the latter is often afflicted with mental illness and substance abuse, but those factors are in no small part driven by our society’s abundance distribution choices. Or is the “hungry” sign just an attempt to seek higher status? I think it’s just food. We would all be living in massive abundance. What makes you so sure the abundance would be so evenly or widely distributed? The abundance we have now is becoming less and less evenly distributed, so jumping to this conclusion just hand waves past some big hurdles in getting there. It gets hijacked by improper pricing of externalities. It gets hijacked by improper yields, where you have corruption, or you have monopolies. Then perhaps the journalists that criticize tech entrepreneurs are actually functioning as a break against this hi jacking? “Status” and “wealth” games not so clearly delineated huh? Capitalism is not even something we discovered. It is in us in every exchange that we have. You can literally say this about any human behavior. Again, this just hand waves and papers over difficult and complex choices. It just assumes his world view is inherent and virtuous. We are the only animals in the animal kingdom that cooperate across genetic boundaries. False. And easy enough for anyone to search on this topic and see so. Everybody can be successful. It is merely a question of education and desire. Wow. If there was any doubt before, it’s now obvious we’re in a complete fantasy at this point. There’s no bias, no prejudice, no advantages that one group has over another. Wait, well except education. Clearly we need to fix that because education isn’t as easily accessible to all, right? But that’s no big deal. I’m not talking about monopolies. I’m not talking about crony capitalism. I’m not talking about mispriced externalities like the environment. Yep, never mind. You’re not talking about the real world. It goes on and on like this but Im done here.
• pototo666 5y ago
  > You Won’t Get Rich Renting Out Your Time > Live Below Your Means for Freedom > Learn to Sell, Learn to Build Personally I like these three pieces. HN users are good at picking something they don't agree and agure against it. It's fine. But how about discuss what you believe is intereting and useful?
  • cweill 5y ago
    +1 to these three. I also like the observation about the only things that are "permissionless and limitless leverage" being media and code. If you position yourself along on of those (or both) and are patient, you have the chance to become extremely wealthy, especially once you've mastered the other 3 points you mentioned.
    • pototo666 5y ago
      > permissionless and limitless leverage Yes, this one is extremely actionable.
• fallingfrog 5y ago
  “Wealth is assets that you earn while you sleep” Sorry, but somebody is still producing that wealth through their labor. It’s just not your labor. Wealth in the sense that the author is using the word is when you collect the fruits of other people’s hard work. No matter how you set up your economy, only a small number of people can live like that, so no, by definition this is not a strategy that everyone can use. Otherwise, who would be doing all the actual work?
  • fallingfrog 5y ago
    As a corollary, I imagine that if I was a member of the class that owns things but does not work, I would not sleep well at night. After all, those who own wealth need those who work. The ones who work know how to make things, grow food, set a broken bone, build bridges, change diapers, do all the things that need to be done, but those who own things can’t do any any of that stuff on their own. In a way they’re like helpless children. They need us, for everything. But do we need them? No. This article is literally saying that the property owning class can perform their function in society while they’re asleep. Well, if that’s true then they’re not contributing anything of value. If I were one of those who own wealth, I would worry greatly that one day the people who work would figure this out. That’s the sword of Damocles that hangs over the heads of the wealthy.
    • dave333 5y ago
      This is a fallacious argument that ignores how progress occurs. Owners do not merely own, they create the process that produces the wealth. Without them we would still be in the stone age.
  • dave333 5y ago
    The key is that machines (bulldozers, airplanes, websites etc.) multiply work to produce more wealth per unit of labor based on a productivity multiplier. Labor is a free market that can fail due to wages being insufficient or can be distorted by a minimum wage that may reduce demand for work to the point of significant unemployment. Need to model the whole system in detail to reach any conclusions. Single sentence observations are nearly always wrong in some respect.
• nicomeemes 5y ago
  > Anyone can come here, be poor, and then work really hard and make money, and get wealthy. While I agree with some of the article, I feel like this statement simply isn't true anymore. Probably for software/hardware engineers, but there's a shrinking middle class in America who can't afford a house despite working multiple jobs and doing everything right. My grandfather worked at Safeway and could support my mom and save up to buy a house. Seems like this would be impossible now. I don't know what the crux of the problem is, but something is definitely wrong with our system.
  • bombcar 5y ago
    It can be done but it requires sacrifices that not everyone will be willing to do. For example, choosing a location “in the sticks” can certainly help.
    • ajmadesc 5y ago
      Why should labor sacrifice a comfortable existence when the elite could sacrifice their exotic united foods, quarterly first class trips to the Seychelles, and bi weekly shiatsu
    • seoaeu 5y ago
      That's empirically not true. There's tons of people who make all those sacrifices and still don't end up rich.
      • zo1 5y ago
        "Getting rich" shouldn't be our metric, as it's arguably an unreachable goal. Rather, we should aim for something definitely possible: Make our successive generation better off than what we had (in the context of each family unit). If that means giving them a better education (or giving them an education at all), or passing down some wealth in the form of inheritance or wisdom, or making sure they have stable upbringing that you didn't have then so be it. That is good enough in the grand scheme of things, and I would argue is the most moral view we can take on this game if we take a multi-generational approach to it.
• exabrial 5y ago
  I disagree that wealth is limited (we can mine an exhaustless supply of minerals for instance). But he nails everything else.
  • lwouis 5y ago
    > we can mine an exhaustless supply of minerals for instance Humanity is headed towards shortages of many critical metals, such a copper, within this century, with consequences on price and availability already felt and predicted to be a major geo-political issue within a few decades
    • exabrial 5y ago
      I disagree. We're short iridium, We're not short copper. We don't have an efficient way to extract it, from either waste or from raw materials. That's also the other side of it: we're short better wiring materials/technologies because copper is 'good enough' at it's price point.
  • cweill 5y ago
    I missed the part where he says that wealth is limited. Doesn't he says that wealth creation is a positive-sum game (I.e. 1+1=3 thanks to automation and leverage), as opposed to status which limited and its pursuit is a zero-sum game? Wouldn't that mean that wealth is unlimited?
    • exabrial 5y ago
      > Most of the wealth in civilization, in fact all of it, has been created. After re-reading your comment, I realize I think I misterpreted this sentence. He's not saying the total future value has already been created, he's saying the past value was worked for
    • developer93 5y ago
      Eventually wealth relies on some physical resource somewhere down the line, so it's also not true imo. Wealth is remote from limits but not limitless I would say.
• deleted 5y ago
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• paulpauper 5y ago
  >Ending up in an orange jumpsuit in prison or having a reputation ruined is the same as getting wiped to zero—so never do those things. Only if you lose everything too or get a really long sentence. I think Michael Milken is an obv. counterexample to this, having kept his wealth and reputation. Jordan Belfort got a lucrative book, movie and consulting gig from his behavior. many others.
• dandanua 5y ago
  I don't see much logic in this wall of text. "Seek wealth, not money or status". What? To get wealth you need money to buy it. To get to the point B you have to pass the point A. That's why people are seeking money. Secondly, it's claimed that those who say "We don’t want money" are playing another game - seeking high social status. That's another perverted logic. Seeking high social status is the most reliable way to have a lot of money without doing anything useful. That's why corruption is everywhere – people go to power to be rich, not because they want or able to solve societal problems. People who really don't seek richness don't seek high social status either.
  • redisman 5y ago
    The concepts are also linked together. Having lots of money automatically means having high status unless you actively reject it. If you think you don't have status but have lots of money then you merely need to go to places that only people with lots of money can get to and see how you get treated.
• gambiting 5y ago
  "You want wealth because it buys you freedom—so you don’t have to wear a tie like a collar around your neck; so you don’t have to wake up at 7:00 a.m. to rush to work and sit in commute traffic; so you don’t have to waste your life grinding productive hours away into a soulless job that doesn’t fulfill you." Am I the only one here who doesn't have any kind of "wealth" as defined by the author, yet doesn't suffer from any of the above? We don't wear ties, I don't have a commute, and I really enjoy my job. Is investing any of my time(as in - sacrificing time that would be otherwise spent with my family or just on relaxing) in "wealth" still the right choice?
  • deleted 5y ago
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  • neogodless 5y ago
    If money was no object, would you live your life exactly the same way? But to your point, if you live your life in a way you hate just to accumulate money, you're also doing it wrong (in my opinion). Try to accumulate money through work you enjoy, but if you can build up wealth to give you additional choices and control over how you use your time.
    • deleted 5y ago
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  • lukas099 5y ago
    That's awesome! Unfortunately it isn't true for a lot of us.
  • xyzelement 5y ago
    Honestly, it's a metaphor. It makes sense to try and understand the intended lesson. The fact that you don't actually wear a tie at work is kinda besides the point. I LOVE my work. But I also LOVE the idea that I can stop working if I wanted to, at least for a while, because of savings.
  • system16 5y ago
    "Am I the only one who..." The answer is almost always 'no'.
• vlovich123 5y ago
  > But for the fourth kind of luck, there isn’t a common cliché out there that matches the unique character of your action “Right spot, right time” I think there’s a lot of flaws in the reasoning and characterizing anyone who isn’t prioritizing wealth creation (or even the concept of a tax) as a parasite is extremely miopic. For one, if you don’t have any customers, good luck creating your wealth. The data repeatedly shows that a stronger safety net (which requires taxes) encourages more risk taking and better allocation of wealth creation. Characterizing those that aren’t able to have that freedom as parasites… you have to be really full of yourself to make a claim like that.
• deleted 5y ago
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• slumdev 5y ago
  > The purpose of wealth is freedom; it’s nothing more than that. It’s not to buy fur coats, or to drive Ferraris, or to sail yachts, or to jet around the world in a Gulf Stream. That stuff gets really boring and stupid, really fast. It’s about being your own sovereign individual. This makes sense. > Today, I would rather be a poor person in a First World country, than be a rich person in Louis the XIV’s France. I’d rather be a poor person today than aristocrat back then. That’s because of wealth creation. I'm not sure we can have it both ways. If the purpose of wealth is to be sovereign and have the freedom and time to pursue my own interests, whatever they are, then it's better to be a wealthy person at any time in history than to be a poor person at any other time in history. A poor person today is going to spend 8-12 hours per day, 5-7 days per week, working and commuting, depending on how many jobs they have, just to pay for necessities. An aristocrat in any time period is going to have far more time to do any of the things that fulfill him. Air conditioning, health care, and Netflix don't make up the difference.
  • lukas099 5y ago
    Not dying early of childbirth or plague might make up some of the difference, though.
• christiansakai 5y ago
  I love it how Americans and first world countries native born just love to bash these kinds of articles. While people like me who came from 3rd world country that immigrated to US and first world countries can relate with posts like these.
  • xyzelement 5y ago
    Exactly! I used to travel a lot for work and talk to Uber drivers all over the country. The immigrant ones had stories like "I own 3 of these cars, so 2 guys drive for me, and my daughter is in nursing school" or my favorite "I just got hired in Columbia University as a janitor so I can get my MBA there for free". While the Americans were just kinda resigned to driving the Uber. Immigrants are self selecting - we are people who chose to make moves, get off our asses to make something of ourselves .so of course the idea of accreting valuable skills and assets is going to resonate with us.
    • christiansakai 5y ago
      I love immigrant stories! U know what we have in common as immigrants. We just love to work and make money, to see that our hands actually produce money that goes into our bank statement just brings joy. It is almost not about the money itself but the honor that we get knowing that people appreciate our service.
    • lotsofpulp 5y ago
      > we are people who chose to make moves, It’s easier to make a move when you have nothing to lose, or have a fallback option in your home country.
      • christiansakai 5y ago
        FYI, usually in 3rd world countries don’t have unemployment benefit, govt support or bankruptcy laws. Not sure what fallback you meant here.
        • 5y ago
• vladmk 5y ago
  “ Wealth is money in the bank that is reinvested into other assets and businesses.” So is it money in the bank then or is is it money reinvested? Or all of the above? He doesn’t really clarify. Am I the only one that found holes in his thinking? Example: the more houses we build the cheaper it will be...fact: there is more houses today than at any other time in American history. House prices are only increasing...buying up a scarce resource like land doesn’t help us create more of it, what helps us create more is investing in the resource. I’m not trying to put Naval down since I do admire him and some of what he says, I just can’t put him on this guru pedestal others are... I think true wealth is being able to control your time however you’d like. Everything else after that is about power.
  • GeneralMayhem 5y ago
    > the more houses we build the cheaper it will be...fact: there is more houses today than at any other time in American history There are also more people than at any other time in American history...
    • vladmk 5y ago
      100% so his argument fails. The need for houses is more essential today than ever, we’ve built more than ever, yet they’re very expensive. The scarce resources Naval fails to point at is what also powers your “there’s more people today” point.
• bitwize 5y ago
  Making money is like a clicker game, such as Cookie Clicker. If you are earning a wage at a job, you're still in the boring part of the game where you click to get cookies. Wealthy people are playing the metagame, buying the grandmas and factories and space vortexes that automatically generate cookies. And that's when the game gets fun. I think our concept of "greed" is a bit misplaced. Greed is not about having more money just to have it. If you or I had as much money as Bill Gates or Donald Trump, we wouldn't know what to do with the huge amount left over after all our needs and desires are met. It's about being able to buy the next thing that automatically clicks for cookies, so that they can continue making cookies (money) faster. Increasing the rate of cookie generation means they're winning at the game. It's their hobby, it's their passion.
  • developer93 5y ago
    but you can employ people for that too
• samatman 5y ago
  It isn't at all true that hunter-gatherers had only status and not wealth. The Native American tribes of eastern North America used wampum, small, regular beads made from a few specific shells, as a store of value and medium of exchange. Yes, they couldn't own that much more than they could carry. Some of these peoples did farm, some didn't, but all of them relied on hunting or fishing, and most had to move around at least a couple times a year. But a wealthy Iroquois could wear enough wealth to buy many times what he could carry in meat, tools, furs, and anything else which other people could make available. Shell money isn't limited to the Native Americans, either, it's been found in paleolithic grave goods and was quite widespread anywhere Europeans encountered hunter-gatherers.
  • PaulDavisThe1st 5y ago
    There's also the potlatch tradition of several PNW tribes, in which wealth was demonstrated by giving it away at celebrations, in the form of food, art, clothing, etc.
    • samatman 5y ago
      Yeah I was considering continuing down that road, and saying that, if anything, status derives more from wealth in hunter-gatherer cultures than it does in sedentary cultures. Status hierarchies in nomadic foraging societies tend to be flatter, and more fluid, and based on what the 'big man' can do for his posse: leading them in war parties, having a lot of wampum or copper to give away for life occasions like bride price, throwing big feasts and so on. The eldest son of a chief has a head start in life, but far less security than being the heir of titled nobility in a primogeniture culture entails.
• legulere 5y ago
  > Wealth is the thing you want. Wealth is assets that earn while you sleep; it’s the factory of robots cranking out things. Wealth is the computer program running at night that’s serving other customers. In reality you still need people to earn money. Wealth really is the control over the limited means of production which allow you to gain out of the work of others. There are also positive sides to it though: Having other people earn money for you is a pretty high incentive for bringing into the world new means of production
• jollybean 5y ago
  The author is crossing streams with 'value capture' and 'value creation', they are not the same thing. Investing does create value, but a lot of it is just poker. Being better at poker than a fool is a net zero-sum win for society. Though most startups do create some value, it's also questionable in the big picture. And a huge amount of value is created by individuals who are not able to capture the surpluses.
• jiofih 5y ago
  The missing detail is that 99% of people have no access to these wealth creation mechanisms. Having money into the stock market is already a >1% privilege and not nearly enough to generate wealth (unless you already have it).
  • imgabe 5y ago
    90% in the world? Maybe. 90% in the US, or most western countries? Certainly not.
    • jiofih 5y ago
      Absolutely in the west too. What makes you think otherwise? Which opportunities are available for common people that don’t have any safety net?
      • imgabe 5y ago
        You said 90%. The 90th percentile income in the US is $125,105 / year for an individual[1]. The kinds of things he's talking about include "open an investment account and invest money", say in an index fund. Are you telling me that every single person making under $125k in the US has no access to open an account at Vanguard and buy index funds? I know from personal experience that that is not true. [1] https://dqydj.com/income-percentile-calculator/ https://dqydj.com/income-percentile-calculator/
        • jiofih 5y ago
          As I said above, investing in an index fund will certainly help you retire earlier or more comfortably, but will hardly build wealth in the way Sahil talks about in the post.
      • boring_twenties 5y ago
        https://www.pewresearch.org/fact-tank/2020/03/25/more-than-half-of-u-s-households-have-some-investment-in-the-stock-market/ https://www.pewresearch.org/fact-tank/2020/03/25/more-than-h...
• exabrial 5y ago
  This is an incredible piece of literature.
• rundmc 5y ago
  Perhaps a more realistic aim is "How to be able to live comfortably & not have to worry about having enough money in old age (without being lucky)". Disclosure: I'm building a startup https://Tontine.com https://Tontine.com which brings this currently almost impossible target within reach of the majority of savers. If you are lucky enough to live a long life then you'll also get rich but the ability to enjoy your life between 65-95 is what should matter more.