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The Idea of the Year

Every year I look back on the previous 12 months and pull out the best things I’ve read, watched or listened to. A theme usually emerges from the exercise. This year it was more obvious and more interesting than ever before. At the end of the day, we’re all interested in how to be happier and more successful. This year's concept appears central to both.

[“The Third Phase” our Annual Investment Strategy letter from Tom Pence is here. Our Year-End Private Equity letter from Peter Teneriello is here].

Source: Stable Diffusion AI.

This time last year, we interviewed Dr. Iain McGilchrist about his epic masterpiece “The Matter with Things.” One of his most urgent conclusions is that we are approaching the world in a dangerously imbalanced “left-hemispheric” way. So my goal coming into 2022 was to explore what it would mean to rebalance back toward right-hemispheric thinking.

A year later, I’ve realized I’ve actually been learning about the pursuit of wisdom, specifically “relevance realization.”

  1. What do I think it is? (4 minute read)
  2. Why do I think it’s so important? (5 minute read)
  3. How do I think you improve it? (7 minute read)
  4. Some resources and practices.

It’s a big topic, but I hope to do just enough to convince you that this is a rabbit hole worth exploring. I would also stress that this is all a work in progress, and I’d love to be made smarter on it!



1. What do I think it is? (4 minute read)

“I love wisdom. That doesn’t mean I’m wise.”- John Vervaeke.

We don’t seem to talk about wisdom very much. We lack a “wisdom school” or any obvious cultural role models. As a topic, it sounds a bit pretentious and grandiose. By writing or talking about wisdom, you risk implying you’re wise. But I’ve also realized that it’s a deeply personal process with no final destination.

Our guest speaker right after Dr. McGilchrist was cognitive psychology associate professor John Vervaeke. After a breakout 2022, Vervaeke is rapidly becoming one of the world’s most influential thinkers on the topic of wisdom. As I’m not an academic, his work can sometimes be challenging, but it’s equally rewarding. I can’t tell you how many of his podcasts I’ve listened to this year, but this one with Rachel Donald was my favorite. [This podcast is the opinion of the speakers and may not be the opinion of Stifel or its associates.]

Relevance realization is central to Vervaeke’s work. One definition he has used is:

“The ability to ignore vast numbers of options (hopefully poor ones) and focus on a small set of potentially fruitful ones.”

I would summarize the key benefit of relevance realization as “knowing exactly the right thing to do, at exactly the right time.” In specific fields like business or investing, this is similar to being an expert. For life in general, it’s consistent with my favorite definition of wisdom: “knowing what information is important.”

Imagine you’re in a small, dark cave. The cave is full of doors. Some of the doors lead to even darker, dangerous places. Some of them lead into lighter, better places. Through the gloom, your attention draws you to pull one of the handles. When you walk through that door, you emerge into a larger, slightly lighter, cave full of even more doors. You are drawn to the next door handle that leads to an even lighter cave, and so on. As the process continues, your view of each cave gets clearer, and you also get better at finding the right handle more rapidly.

Source: Stable Diffusion AI.

Your view of the world gets increasingly complex, but your ability to navigate it also gets more efficient. If this sounds too mystical and abstract, my favorite “expertise expert” Cedric Chin relates a story about operational wisdom within a utility company:

“It is easy to acquire and instill “middle of the bell curve” knowledge (in an electric utilities company), but at an electric plant, there will be, say, five out of 1500 people who are irreplaceable. A senior relay system protection engineer retired and was replaced by four engineers, each having had 10 years of experience. That did not suffice. When a car hit a pole and two lines tripped, both lines were lost. Across the two lines there were dozens of different kinds of relays and dozens of different kinds of relay protection schemes, some 50 years old. The retired engineer had to be brought back in to fix this emergency situation.”

The retired engineer had both a more complex understanding of the plant and was able to act more effectively than his colleagues. He knew what’s relevant.


2. Why do I think it’s important? (5 minute read)

In his fascinating recent book The Romance of Reality, Bobby Azarian talks about how the ultimate goal of any living thing is to get increasingly more statistically correlated with the flow of its environment. The bacterium that consistently swims away from food won’t last very long. Our aim is therefore to become as efficient as possible when it comes to both minimizing uncertainty and exploring our surroundings. “Knowing exactly the right thing to do at exactly the right time” describes how effectively we perform this balance.

Earlier this year, I revisited my late father’s memoirs. I was struck by a story he told about climbing Mount Tai in China in the 1950s.

“When we reached the top of the mountain we found a Taoist temple. We were greeted by the priest wearing full Taoist regalia. He was the only person I have ever met who had dust on top of his hat and on top of his ears. His first words were to explain that he was in fact a magician and he could not talk to us for very long because he had to go away and make a thunderstorm. I was suitably incredulous but said nothing. When we reached, finally, the small temple on the top where we were to spend the night, we looked round at the surrounding countryside. There was not a cloud in the sky. We laughed heartily at the thought of the Taoist priest trying to make a thunderstorm. We went to bed. At one o’clock in the morning there was the most tremendous thunderstorm with torrential rain pouring over the whole of the peak of the mountain. Dozens of pilgrims who had been trapped on their way up were banging at the temple door to come in out of the storm.”

Whether or not it’s literally true, the idea here is that Taoist sage represents someone who’s maximally correlated with their environment. He gets the highest leverage for the smallest actions: he merely needs to snap his fingers and a thunderstorm appears.

Becoming a sage probably isnt an attainable goal for most of us, but this general efficiency seems to translate to happiness. A recent meta-study of 30 years of wisdom research found it’s correlated with both “hedonic” and “eudaimonic” wellbeing. Hedonic wellbeing describes our pleasure and happiness in life. Eudaimonic wellbeing describes adjustment, growth, and the fulfillment of one’s potential.

Vervaeke also makes huge claims about the importance of relevance realization. He believes it’s fundamental to connectedness, meaning, and our overall flourishing in the world.

The best thing I read this year (and it wasn’t even close) was Brett Andersen’s long-form essay Intimations of a New Worldview. As a collaborator of Vervaeke’s, Brett uses a unique mix of complex systems theory and evolutionary psychology to argue that our participation in relevance realization is “biologically and psychologically optimal.”

We are now allegedly exposed to more information in a single day than someone in the 15th century would experience in their entire lifetime. But our moment-to-moment processing power hasn’t changed. Poor relevance realization is like trying to use the internet without a search engine. We’d be hopelessly lost in an ocean of information. Wasting massive amounts of energy and attention on irrelevant things is a recipe for anxiety, or worse. But the inverse of this problem is incredibly exciting. It asks us the question: what does it mean to be healthily adapted to the Internet? If exposure to the right information helps us evolve into our specific niche, then relevance realization connected to the Internet is a real-life superpower.


3. How do I think you improve it? (7 minute read).

I’ve identified some specific practices and tools (below). But a central concept to emphasize is the role of play. In bounded domains the acquisition of expertise can be accelerated; something that’s implied by the fact that wisdom doesn’t necessarily correlate with age.

Cedric Chin believes that the key is: lots of repetitions in simulations of real world environments with good feedback loops, preferably from an expert. This is a decent description of a game. One of Brett Andersen’s central arguments is also that evolution is driving us to play positive-sum games at increasingly greater scale. Play is exploration within a safe container. Safety allows for rapid feedback, so it’s key to the acceleration of expertise and relevance realization.

For example, the U.S. Military has both a lot of money and significant interest in the rapid acquisition of expertise. The gut feeling a veteran operator gets when he senses an Improvised Explosive Device (IED) might be nearby is a case of expert intuition being the difference between life and death. But book-learning hasn’t been able to keep up with the rapid evolution of warfare tactics. So the military developed a simulation where soldiers played as the insurgents when placing IEDs. This rapidly gave them an intuitive sense of what was most relevant: where within a complex environment they should look for danger. [For more background see: Cedric’s work on cognitive flexibility and accelerated expertise within a business context].

In bounded domains it’s easier to know what to focus on. Expert game-players can immediately see what’s most relevant. After only a couple of seconds, chess grandmasters can nearly perfectly memorize the location of pieces on board. But their advantage over non-experts disappears if the board layout is random and is not relevant to an actual game of chess.

Video games are ruthlessly addictive because they have learned to mimic evolution, skill acquisition, and environmental mastery. The problem is that the relevance realization gained in games often has limited application to the world outside the game. So how do we know where to focus our attention across the infinitely complex landscape of our entire lives? The short answer is: where our environment tells us to focus.

The same 30-year meta-study found that wisdom is correlated with openness, or “the appreciation and tolerance of new ideas, values, and experiences.” This requires constantly breaking and reframing your internal mental models to incorporate the right external information. The IED example is so powerful because taking the perspective of your adversary is a maximal form of openness. So the skills acquired in the game transferred to life outside the game.

Openness means cultivating a general receptivity to knowing which paths or games are specifically desirable for us. There are small leverage points where our unique skills meet what the world needs. The bottom line, as always, comes back to attention: a balance of what first grabs our attention, then holds our attention. Our right hemispheric exploratory attention is emotional, somatic, and largely mute. As a result, it tends to lose to the verbal, logical, competitive, and certain left hemisphere. The left sees the outside world as flat and passive; just matter to manipulate. This prevents us from believing that one door handle is better than another. But also that “evolution” helps signal to us which handle to pull by directing our exploratory attention to it.

The most entertaining podcast I listened to this year was Tim Ferriss with lion tracker Boyd Varty. As well as being a great storyteller, Varty is a profound source of wisdom on the principles of wisdom and relevance realization. This makes total sense: he describes tracking as the ability to align with the world’s intelligence.

“The idea that there is information in your life, if you are looking for transformation, but you have to teach yourself to attune to it. And so, what do you need to attune to in transformational processes? Things that make you feel expansive, things that make you feel alive, letting go of your rational idea of what you should do and noticing what you move towards. Noticing what you’re curious about, noticing the people who energize you, the activities that make you feel more alive.”

“Attractors” in our environment helps signal to us what to pay attention to. This “pull” to places that are relevant to us has a feeling attached to it. It is variously described as attraction, interestingness, bliss, or love. I believe this is why Vervaeke talks about relevance realization as being associated both with a sense of connection and meaning. Pursuing attractors feels meaningful and requires a reciprocal relationship with your environment.

My suspicion is that our heart is central to the process of relevance realization. There’s a great story in Philip Shepherd’s book Radical Wholeness about the Sng’oi people of Malaysia. Psychologist Robert Wolff found that they would often anticipate his visits to their settlement despite having no conceivable means of knowing he was coming. They talked about an “ancient way of knowing.” He even describes a time when he personally experienced it. After spending long days walking the jungle with a tribesman, he was asked to find water. As he watched him strain his senses, the tribesman simply said “water inside heart.” Wolff suddenly found he was simply able to sense its presence nearby.

The right hemisphere predominates in receiving and interpreting information from the heart. It’s interesting to me that many other cultures regard the heart as an organ of perception, but we tend to treat references to it as metaphorical. But the heart is associated with elements of ultimate relevance: truth, guidance, and love.


In summary:

  1. “Relevance realization” is critical to flourishing in life.
  2. In bounded domains, it can be accelerated through designing effective games.
  3. In unbounded domains, relevance realization requires an openness to external guidance.
  4. Openness is achieved by cultivating right-hemispheric skills.
  5. This means pursuing “positive-sum” games that are intrinsically enjoyable.
  6. The better we get at relevance realization, the more adapted we get to our own specific niche. This makes us both more efficient and maximizes the impact we can have on our environment.


4. Resources and Practices:

  • If you’re comfortable with academic papers, I recommend this recent piece from Vervaeke, Brett Andersen, and Mark Miller: “Predictive processing and relevance realization: exploring convergent solutions to the frame problem.”

  • John Vervaeke has a series of lectures in his Awakening from the Meaning Crisis lectures specifically on Relevance Realization. I found his lecture on consciousness especially helpful.

  • Vervaeke talks about his own ecology of practices (meditative, contemplative, and embodied). He recommends Vipassana, Metta, and Tai Chi.

  • I’ve also focused on boundary practices that facilitate ease communication between conscious and unconscious or internal/external. The most dramatic incremental benefits for me this year have been from heart-centered meditation and Brazilian Jiu Jitsu.

I’ve written 18 articles this year on different practical approaches to pursuing wisdom:

  1. Gurus and Pickleball: On the importance of discernment and playing infinite games for their intrinsic enjoyment.

  2. Articulate and Incompetent. On the importance of emotional granularity, both in determining what’s true and also your mental and physical health.

  3. Crisis, Character and Charisma. On the importance telling the truth, to yourself or others. This helps maintain integrity between your conscious and unconscious.

  4. How to Sell Anything. On the power of the flow state to generate fresh insights.

  5. War, Moloch and the Tsar Bomba. On the catastrophic dangers of zero-sum games and how positive-sum games and slack provide both resilience and room for exploration.

  6. Hidden Forces of Radical Hope. On how our unconscious interests lead our evolution, and our current myths are reflecting a transition in consciousness.

  7. The Greatest Thing By Far. On the immense power of metaphor, both in communicating ideas and understanding what’s really true in the world.

  8. Death Wish. On the immense risks of putting your narrow ego’s goals ahead of unconscious signals.

  9. Three Steps to Freedom. On how our attention is stolen by technology, and taken increasingly to abstract, unreal places.

  10. Hacksaws and Dinosaurs. On the voluntary psychological sacrifice required by a hero in order to break stale frameworks.

  11. What am I Missing? On how different cultures see the world and the fact that Western perception is by no means the norm.

  12. Our Invisible War. On how the mental health crisis is being exacerbated by hemispheric imbalance and the denial of our instinct for exploration and evolution of consciousness.

  13. Three Striking Stories. On how right-hemispheric experience has a feeling attached to it. Which indicates that evolutionary progress feels wonderful and acts as a guide to our progress.

  14. Where do Ideas Come From? On the power of “imagination” to close down the limitless possibilities of places to explore for new ideas. How we are drawn to new ideas.

  15. Jack’s Story. A visualization of fitness landscapes to illustrate the balance between zero-sum and positive sum games. Also an account of how we escape stuck places.

  16. No Pain, No Gain. On the benefits of psychological dissonance when generating new insights.

  17. The Talking Serpent. An allegory that attempts to illustrate relevance realization, as well as the ecology of practices that help build the skill.

  18. Regime Change. On the power of shadow work to reveal and resolve our unconscious blocks and motivations.

Have a great holidays, thanks for your partnership and support.

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