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Manage Your Money Like The 1% -Jordan Peterson

The the probability that as you move forward on your adventure that you’re going to get it right the first time is zero it’s just not going to happen and so then you might think well maybe i’ll just wait around until i get the right idea and which people do the median number of publications that phd students have is somewhere between zero and one half as many have

Two half as many of that has three half as many as that have four so it’s a tremendous step down in productivity as it’s an exponential step down in probability with a linear step up in productivity it’s a very very frightening fact now it accounts for why one percent of the population has a huge chunk of the money but you know if you take that one percent and you

Divide them into 99 and one percent the top one percent of the one percent has almost all the money that the top one percent has and then if you take the top one percent of one percent and you divide them into 99 and one percent the top one percent of that tiny slice has almost all of the money that that tiny slice has so it’s also scalable and it’s a problem because

It means that productivity is always in the hands of a few and no one knows what to do about that or even if there’s anything that can be done about it or even if there’s anything that should be done about it people talk about all the time about how unfair it is that one percent of the population has the vast amount of the money and one percent of the one percent

Has most of that money and one percent of the one percent of the one percent has most of that money but it is an inevitable conclusion of iterated trading games and we don’t know how to fight it we don’t know how to take from the people who have and move it to the bottom without it instantly moving back up to the top different people maybe but still back up to the

Top because even the one percent churns a lot like i think you have a 10 chance if i remember correctly you have a 10 chance of being in the top 1 for at least one year of your life and a 40 chance of being in the top 10 percent for at least one year in your life that’s in canada and the us it’s less so in europe so there’s a fair bit of churning at the top end it’s

Not the same people all the time who have the money but it is a tiny fraction of the people all the time who have now that doesn’t mean i think that people of disproportionate intelligence shouldn’t be rewarded disproportionately it’s possible that they should because it might be in the best interest of everyone else to dump as much money as possible to the top two

Percent of the cognitive strata because they’re going to be most generative with it and so and even if it’s not fair because you might say well just because he won the genetic lottery does that mean that you should have more money than anyone else it’s like well not on the grounds of fairness but if you have to distribute money well who are you going to distribute

It to you know and i think he estimated that if you tried as hard as you could in your entire life there was no way that you could spend more than 400 million dollars and so let’s say you have more money than that at your disposal well hopefully you’re going to do some halfways intelligent things with it and hopefully you’d expect that the more intelligent people

Would do more than halfway intelligent things with it so if you have to have unequal distribution then a meritocracy is probably the best way to do it but it still leaves you with this terrible problem which is what do you do with all the people who stack up at zero and the answer isn’t have contempt for them because they don’t work as hard as you one percent of

The people in the general population have the overwhelming amount of money and one tenth of that one percent has almost all of that right so i think it’s like the richest hundred people in the world have as much money as the bottom two and a half billion and you think well that’s a terrible thing and perhaps it is but what you have to understand is that that law

Governs the distribution of creative production across all creative domains right it’s something like a natural law and we can we’ll talk about that more but imagine what happens when you play monopoly you’ve all played monopoly one person ends up with all the money all right then you play another game of monopoly what happens one person ends up with all the money

It’s actually the inevitable consequence of multiple trades that are conducted randomly so if you take a thousand people and you get them to play a trading game you get each give them a hundred dollars say or ten dollars and they have to trade with another person by flipping a coin i win the coin toss you give me a dollar you win i give you a dollar if we all play

That long enough one person will end up with all the money and everyone else will end up with zero so it’s a deeply built feature of systems of creative production and no one really knows what to do about it because of course the danger is is that all the resources get funneled to a tiny minority of people at the top and a huge section of the population stacks up

At zero but to blame that on no one actually knows how to effectively shovel resources from the minority that controls almost everything to the majority that has almost nothing in any consistent way because as you shovel money down it tends to move right back up and it’s a big problem

Transcribed from video

Manage Your Money Like The 1% -Jordan Peterson By Business Central