Max Koh Profile picture
12 Oct, 10 tweets, 2 min read
Why do people get stuck in the rat race with a job they can't quit?

The answer has to do with the "Fear and Greed" cycle:
I recently had a chat with a friend over dinner...

She was telling me how she goes to work everyday out of fear.

Because she's worried if she stops working, she won't have money to pay the bills and put food on the table.

She's driven by fear of not having enough money.
So that forces her to wake up everyday and go to work at a job she doesn't like.

But it doesn't stop there.

It only gets worse because of this other emotion known as "Greed".

How does that come about?
It's because of the unpleasant feeling to be controlled by fear.

It feels like we're not in control of our own destiny.

So what do most people do when they start earning a paycheck?

They try and soothe that fear by buying things that make them feel good.
It makes them feel like they are in control of their lives...

By being able to buy things they want and like.

Because they spend 90% of their day feeling crappy, they hope to at least use the money to reward themselves.
It can be cars, gadgets, holidays...

Anything that makes them feel better and in control of their life.

But that's an illusion.

What they don't realize is that because of greed, the hole gets deeper.

Because how do they pay for these items?

With their salary, of course.
And overtime...

the need to buy bigger and bigger stuff increases with time, because the happiness from the past items wear off fast.

So as the items get bigger and more expensive, now they need to work even harder to keep up.
And when they get married or a kid comes along, that adds to their fear.

But how do they dilute the fear and feel better about themselves?

By working harder to make more money, and then using that money to buy even more expensive stuff!

Before they know it, they are trapped.
They wake up one day realizing they have indeed become a prisoner.

Because now they truly cannot stop working.

The minute they stop, they won't have enough money to pay the bills and cover their obligations.
So they're forced to continue working, even though they feel unhappy.

That's how most people get stuck in the rat race, with a job they hate.

Sadly, most people work their whole lives without ever realizing this.

That's what happened to my friend.

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More from @heymaxkoh

13 Oct
15 Investing Lessons from Yen Liow:

Based off his recent presentation at the MicroCap Leadership Summit 2021.

*Hint: You do NOT need to find 100 baggers to create great wealth.

Thanks to @yliownyc for the value bombs.

And to @iancassel for organizing this.
1. True compounders are rare. Hold on tight when you find one

Over last 20 years, of all the US listed companies with market cap over $2B:

Only 14% of them have have compounded at more than 20% for 5 years.

And only a tiny 3% have compounded at more than 20% for 10 years.
2. Strategy - find horses

Horses are monopolies and oligopolies that compound EPS at 2-3x the broader market for long periods of time.

True north: Over time, stock price and intrinsic value will converge.

So find businesses that can show durable growth in FCF or earnings.
Read 21 tweets
13 Oct
Will you feel happy when you finally quit your 9-5 job and never have to work again?

Here's why that may NOT happen:
3 reasons:

1. Rich is about finding fulfilling work

2. We need to "struggle" for something

3. The same traits that helped you retire early will make you unhappy when you actually do retire early.

Here's my story...
I recall that day mid of 2020, when I hit my own version of financial freedom.

It's been a day I've been waiting for my whole career.

When my portfolio crossed a certain amount of net worth.
Read 16 tweets
12 Oct
This is Bill Walsh.

He was the head coach of the San Francisco 49ers.

He was famous for teaching the team's receptionists how to answer the phone properly.

Here's 12 leadership lessons I learnt from him:

Thanks to @rabois for recommending it in many of his podcasts.
1. Sweat the little things

How the players dressed and the appearance they gave to others when taking the field was very important.

I wanted our football team to look truly professional—impeccable.

Thus, shirttails tucked in, socks up tight, and more were requirements.
2. Respect the team

Players were told their practice helmets, which carried our emblem, should never be tossed around, sat on, or thrown in the bottom of their lockers:

“Wear it, hold it, or put it on the shelf in your locker.”

It represents who you are and what you value.
Read 17 tweets
11 Oct
Richer, Wiser, Happier.

This has been my favourite investing book of 2021.

Here's 20 of my favourite quotes and lessons:

Thank you @williamgreen72
1. Bet big but infrequently

You have to be like a man standing with a spear next to a stream. Most of the time he’s doing nothing.

When a fat juicy salmon swims by, the man spears it. Then he goes back to doing nothing. It may be six months before the next salmon goes by.
2. Read a lot + Patience

How long can he go without buying? “Oh, I can wait ten years—even longer,” Chou replied.

In the meantime, he studies stocks that aren’t cheap enough to buy, hits balls at a golf range, and reads two hundred to four hundred pages a day.
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10 Oct
Investing & Meditation. My true short story:

I come from a Buddhist family. 2 of my aunts were ordained as Nuns in their early 20s. That's how deep and serious this runs in my home.

I was taught how to meditate at age 4. Focus on breathing. Watch my thoughts.

I hated it.
As a kid, I couldn't sit still. I had a "monkey mind" as they called it.

The adults kept encouraging me to meditate. But I was a rebellious teen.

Fast forward to today, I have been meditating without fail for almost 15 mins every morning. Since Jan 2019.

What changed?
I started investing more seriously.

Started putting more of my money into high growth stocks, and the volatility and draw downs made me realize how weak and frantic my mind was.

Out of panic, I started meditating seriously to learn how to center myself.

What's the lesson?
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9 Oct
Friend of mine borrowed a fair sum of $$ from the banks in the march 2020 covid crash. Even took on leverage.

Best time to buy stocks, he said.

He even built a financial model on excel to understand his downside.

No issue.

But a few weeks later, he sold them all.

He told me:

“When the 2nd circuit breaker hit and the market fell further, I took a double look at my excel model.

I could still take further drawdowns and be ok.

But when I picked my 5 year old daughter up from school that day, I started to panic...
“Am I making the right decision, I wondered?

What if something happens that I didn’t expect?

I wouldn’t be able to give her the life I promised I would. “

Few days later, he sold all his stocks.
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