The Almanack of Naval Ravikant cover

The Almanack of Naval Ravikant

by Eric Jorgenson

Business
BOOK INFOGRAPHIC The Almanack of Naval Ravikant by Eric Jorgenson TL;DR True wealth comes from owning equity, leveraging code andmedia that work while you sleep. KEY THEMES $? FinancePhilosophyHappinessDecision Making 6 min read 12 sections Ambitious... Seek wealth, not money or status. Wealth is having assetsthat earn while you sleep.

The Five Big Ideas

The Almanack of Naval Ravikant Summary

Below are my five favorite big ideas from the book, rewritten for brevity.

1. Understand How to Create Wealth

To get rich, seekspecificknowledge,accountability, andleverage.

Pursue your genuine curiosity and passion rather than whatever is hot right now. Specific knowledge is often highly technical or creative and cannot be outsourced or automated.

Take business risks under your name as much as possible. Take credit when things go well and ownership when things go wrong. Society rewards those with responsibility, equity, and leverage.

Leverage comes in the form oflabor,capital, or throughcodeormedia. Labor requires followers. Capital requires leaders. Code or media, however, are permissionless and work while you sleep.

You will not get rich by renting out your time. To gain financial freedom, you must own equity—a piece of a business. Give society what it wants but does not yet know how to get at scale.

2. Build Judgment

If wisdom is the knowledge behind the long-term consequences of your actions, judgment is the knowledge to make the right decision to capitalize on those actions. In the age of leverage, one correct decision can win everything. Judgment is underrated.

To build judgment, you must keep abreast of current trends and study technology, design, and art—and become the best in the world at something. The direction you head in matters much more than your pace. Choose wisely.

Judgment—especially demonstrated judgment, with high accountability and a clear track record—is critical. Warren Buffett has been right over and over in the public domain, and for that reason, has massive credibility.

Being at the extreme in your art is crucial in the age of leverage.

3. Learn the Skills of Decision-Making

To make better decisions, learn mental models. A mental model is an explanation of how something works. Inversion, to borrow a popular example, is a mental model that invites you to be less wrong rather than more right.

If you can’t decide, then the answer is no. We live in abundance. There are countless options to choose from. If, however, you’re evenly split on a difficult decision. Take the path more painful in the short term. Easy decisions, hard life. Hard decisions, easy life.

For important decisions, discard memory and identify and focus on the problem. The smaller you can make your ego, the less conditioned you can make your reactions, the fewer desires you will have about the outcome you want, and the easier it will be to see reality.

To build judgment, you must keep abreast of current trends and study technology, design, and art—and become the best in the world at something. The direction you head in matters much more than your pace. Choose wisely.

Being at the extreme in your art is crucial in the age of leverage.

4. Learn to Love to Read

To build specific knowledge, read what you love until you love to read.

If you’re a slow reader, read one hour per day; it will likely put you at the upper echelon of human success within seven years. If you’re a fast reader, slow down; it’s not a race. The better the book, the slower it should be absorbed.

Read science, math, and philosophy. But be selective. Read the fundamentals likeOn The Origin of SpeciesandThe Wealth of Nations. Then reread them; it’s better to read a book that you’re excited about a hundred times than it is to read one hundred average books that don’t.

If a book doesn’t interest you at first, flip ahead, skim, or speed read. If it still doesn’t interest you after the first chapter, drop the book. Most books have one point to make. Once you get the gist of a book, put it down.

5. Understand Happiness is a Choice

Happiness is not about positive thoughts. Nor is it about negative thoughts.Happiness is the absence of desire.To quote Ravikant, “Desire is a contract you make with yourself to be unhappy until you get what you want.”

In any situation in life, you always have three choices:you can change it, you can accept it, or you can leave it.If you want to change it, then it is a desire. To avoid distraction, pick one desire in your life at a time to give yourself purpose and motivation.

If you want to accept it, trace the growth and improvement that’s come from previous experiences you’ve had in your life. Or, ask yourself, “What is the positive of this situation?” There’s almost always something positive.

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