The soothing notion that chaos can flow from order.
First, watch this:
Get that? In reverse, this (wait for it ...):
And this:
Flows from this simple looking equation:
Where this changes things:
I was taught that chaotic results came from complex systems. Inconsistency arose from a failure to control. Fluctuating returns carried shame because they implied mismanagement.
There's no denying that running investments and businesses is complex, but what if returns were unpredictable no matter how simply we managed to run them?
Well, it would let me off the hook for not consistently exploiting windfalls or preventing disasters.
This doesn't mean we shouldn't try for results because we can never predict them. Instead, we shouldn't punish ourselves because results differed from predictions.
For me, it frees up the resources I would otherwise spend on projections to reallocate to finding or providing value. Rather than beating myself up for being two decimal places off my yield predictions, I can instead ask myself if I'm really investing in the future or if I'm really improving the lives of my tenants.
It also helps me accept outcomes that 'orbit' - however chaotically - around certain points.
Chaos is not failure. Quite the opposite in a way. The price for total certainty is no outcome at all.
First, watch this:
Get that? In reverse, this (wait for it ...):
And this:
Flows from this simple looking equation:
xn+1 = rxn(1-xn)
Note that the value of x is dependent on the previous value of x. Real world applications include population models. It also resembles investments where historical prices are part of valuation, and tenancies where this year's occupancy depends on last year's occupancy.Where this changes things:
I was taught that chaotic results came from complex systems. Inconsistency arose from a failure to control. Fluctuating returns carried shame because they implied mismanagement.
There's no denying that running investments and businesses is complex, but what if returns were unpredictable no matter how simply we managed to run them?
Well, it would let me off the hook for not consistently exploiting windfalls or preventing disasters.
This doesn't mean we shouldn't try for results because we can never predict them. Instead, we shouldn't punish ourselves because results differed from predictions.
For me, it frees up the resources I would otherwise spend on projections to reallocate to finding or providing value. Rather than beating myself up for being two decimal places off my yield predictions, I can instead ask myself if I'm really investing in the future or if I'm really improving the lives of my tenants.
It also helps me accept outcomes that 'orbit' - however chaotically - around certain points.
Chaos is not failure. Quite the opposite in a way. The price for total certainty is no outcome at all.
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