Conversations For Transformation: Essays Inspired By The Ideas Of Werner Erhard

Conversations For Transformation

Essays By Laurence Platt

Inspired By The Ideas Of Werner Erhard

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Stake To Play

Twomey Cellars, Calistoga, California, USA

March 5, 2014

This essay, Stake To Play, is the fifth in a group of ten on Money:
  1. Money And Us
  2. Give Me Money (That's What I Want?)
  3. Laurence Platt Video Interview III
  4. Exceptionally Rich
  5. Stake To Play
  6. Breakfast With The Master II: Future Finances
  7. Profit And Loss
  8. New Financial Order
  9. Really, Really Bad
  10. Standing Up To Gold
in that order.

Stake To Play
Some time around now (it may have been closer to five years ago or five weeks ago or five days ago but nonetheless some time around now)  the role money plays in my life, shifted. It's not that I've now got less money or more than I had. No, this shift isn't a quanti-tative shift: it's a quali-tative shift. Having less money or more money would be a content-ual shift. This isn't like that. This is a context-ual shift. In other words, this shift shows up in how money occurs  for me, not in the amount I have.

I'm a conservative investor. And the degree to which my investments are worth more now than the total of all my combined down payments in each of them was, is the degree to which I'm also a successful investor. I invest for the long term. Ordinarily I avoid high risk investments. I'm more comfortable with a solid, steady, modest 10% return than I am with an uncertain albeit possible 210% return. I like it to be secure.

About fifteen years ago a good friend of mine, an awesome money guy  and a fund manager, looked at my portfolio, liked its spread, then suggested I consider adding an admittedly high risk instrument to the mix. It cost a lot to buy in. But that's what I did - knowingly, responsibly. The upside is if it paid off (after an expected fifteen years) it would pay off big time. The downside, as with high risk investments, is if it failed, it wouldn't just lose value: it would be worthless. It failed. It's now worthless.

My friend called me to tell me about it. I could hear in his faltering voice how badly he felt. Given what was for me a substantial amount of a now worthless investment, I calculated his failed high risk fund's gamble had lost millions  of dollars for all his trusting clients. But listen: that's why they call it high risk, yes? And nobody forced  me to buy in, nobody forced me to write a check. That said, I could tell this was a guy who was now carrying a heavy load on his shoulders. "I'm sorry I lost your money" he gamely told me (what else could he say?). "Don't think about it" I said, "it was my stake to play  at the table.".

Soon after the failure of the high risk investment, the value of my portfolio (which is to say the value of the rest of my solid, steady, modest 10% return portfolio) grew to cover the high risk investment's loss. That's how it turned out. Investing doesn't always turn out so well. But isn't it great when it does?

In any conversation for possibility, it doesn't work well to say "Life  is a gamble" simply because of the distracting sub-text  which goeswith  (as Alan Watts may have said) gambling: blackjack, roulette, one armed bandits, and of course Gamblers Anonymous. Speaking in terms of risk  (saying "Life is a risk")  is more apropos and more listenable. Without risking, life creeps on and on at the same brain‑numbingly petty pace (as William Shakespeare may have said).

Any life worth living is worth risking. Taking risks requires a stake to play. So ante up!  It's better to have risked and lost than to have never played at all.

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