The Investor Frame
Level 3: Master of Mundane
Future Guardian,
Imagine you're standing at a crossroads in your life, with different paths stretching out before you. Each path carries its own weighty consequences, and you're struggling to decide which one to take. It's a moment of uncertainty, and you're yearning for clarity, like a guiding light to help you make the right choice.
In this pivotal moment, you're not looking for advice from others. Instead, you're searching for a trusted framework, a reliable companion in your decision-making journey.
Well, with that introduction, it’s clear that such a framework does exist and we will be covering what Dan Nicolson describes in his book Rigging the Game as the Investor Frame.
The Decision Dilemma
Life is filled with pivotal decisions, from personal relationships to financial investments, and career choices to housing decisions. These choices often leave us in a state of uncertainty, torn between what we desire and what seems practical. It's in these moments of doubt that 'The Investor Frame' steps forward as your reliable companion
What is 'The Investor Frame'?
Imagine this framework as a multifaceted lens through which you can view your decisions. It's a tool designed to empower you with clarity, using your own logic, reasoning, and evidence as guiding principles.
Your Personal GPS
Much like a GPS guiding you through unfamiliar territory, 'The Investor Frame' will help you navigate the uncertain terrain of decision-making. It works by posing a simple yet profound question: Does your choice align with your current economic and personal principles? If the answer is 'yes,' you're on the right path. If it's 'no,' then it's time to ask, "What would need to be true for me to say yes?"
Integrating Past Wisdom
Now, let's integrate the wisdom you've gained from your journey so far:
Appreciating ‘Bumpers’:1
You've learned to appreciate when bad things don't happen, the invaluable concept of 'Bumpers.' These are the moments when you avoid unfavorable outcomes—a crucial aspect of decision-making.
Resource Allocation:2
A key lesson on your journey has been the significance of resource allocation. Specifically, stopping the cycle of making decisions that violate your personal and economic principles. Remember, these decisions aren't objectively bad, but bringing it back to DALA3, they steer you away from what you truly want.
Certainty of Misery:4
"Most prefer the certainty of misery to the misery of uncertainty." -Virginia Satir. This quote resonates with the journey, highlighting the human tendency to cling to the familiar, even if it brings misery. 'The Investor Frame' empowers you to break free from this cycle.
The Uncomfortable Reality
Staying in a bad situation is the same as making a new bad decision every day.
Staying in a bad situation is the same as making a new bad decision every day. 'The Investor Frame' comes to your rescue here. It enables you to recapture and reallocate all of those resources from a bad situation, allowing you to align with your own economic and personal principles.
Practical Examples
Should I stay in this relationship?
Imagine this: You've been in a toxic relationship for five challenging years. Lately, it feels like you're trapped in a cycle of arguments and disappointment. The love you once shared seems overshadowed by constant turmoil.
Given what you know today would you opt back in to your relationship that hasn't been working for the last 5 years?
If No, it's time to make a change.
If Yes, even though you might be upset about something you're not violating your own personal and economic principles.
Often times people will let emotions get the best of them, driving them out of good situations. Had they simply zoomed out and utilized the Investor Frame they might have seen something different.
Should I rent out my home?
Imagine this: You own a house, and after much consideration, you decide to purchase a new home to live in. Now, a question arises regarding your old house. What should you do with it? You contemplate the idea of renting it out, but let's examine this choice through the lens of the Investor Frame.
Your old house is worth 2 million dollars and given what you know now would you pay 2 million dollars at this point to have this house to rent it out?
If No, you are violating your own principles and your resources are being misallocated. You could sell the house for 2 million dollars and allocate those funds to something that funds a priority of yours.
If Yes, then rent it out.
Bitcoin or Stock/Investment
Imagine this: You initially invested $100,000 in BTC (or another investment vehicle), but the current value has dwindled to $50,000. It's important to acknowledge that this situation can trigger a strong aversion to losses.
If someone asked you "If you had $50,000 what would you do with it?"
If your response was "Well I'd buy BTC.”
There is your answer, you are not violating your own personal economic and personal principles. You'd purchase $50,000 of BTC and you own $50,000 worth of BTC.
If your answer was: "No, I'd buy land". Then you would sell BTC and buy land.
This scenario highlights a common issue in various investment communities, including the Web3 space. It's the tendency to rely on others for investment decisions rather than taking charge of your choices. The Investor Frame offers a solution—it empowers you to make decisions grounded in your own logic, reasoning, and evidence.
Moreover, the Investor Frame isn't limited to investments alone; it can be applied to all aspects of your life. It enables you to reclaim and reallocate resources, replacing elements that misalign with your principles with those that resonate more closely with your values.
While many are constantly seeking ways to accelerate their progress, having the Investor Frame in your toolkit is akin to releasing the brake pedal. Once you've tried it out, feel free to share your six-word update below.
Resources
Listen: Apple Podcasts | Spotify
Watch: Youtube
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6WU- Wisdom Comes From Multiple Perspectives
Can you summarize what you've learned into six words? Share them on the thread below so that others can also benefit from your wisdom. After you've shared be sure to read through what others have said as well to see what you can take away.
https://twitter.com/TheGuardianAcad/status/1617560414870552587?s=20&t=mDwnjmxw4JHWzsoBpXhHEQ