My good friend Jason Buck, founder and CIO of Mutiny Funds, joins me to tell the painful and darkly funny story of how the 2007–2008 crash destroyed his real estate business, wiped out his paper wealth, and taught him one of the hardest lessons in markets: being right is not the same thing as making money.
Jason explains how he went from real estate developer to volatility trader and eventually built his philosophy around survival, resilience, and the “Cockroach Portfolio.” We explore many of my favorite topics, including why our pesky humanOS is the most persistent source of market mistakes, and why investing beliefs often resemble religion.
This was such a fun conversation. I’ve shared some highlights below, together with links & a full transcript. As always, if you like what you hear/read, please leave a comment or drop us a review on your provider of choice.
— Jim
Links
Highlights
What would you do if you knew you would fail?
Jason Buck: And with insatiable curiosity, and I know this is what we were kind of getting at earlier about portfolios, it’s extremely personal to us. It’s praxis, right? This is my entire life philosophy that I’m putting into this business and this portfolio for you. So it’s deeply personal. And so to me, it was more of that alignment where maybe in my younger years and maybe living under what’s important to others or some sort of Girardian mimesis, where it got to the point of, this aligns with my values and who I am at this point, and this is deep practice for me. So this is all I want to do. If it works, if it doesn’t. But this is what I want to do.
I always, I joke with our mutual friend Senra about there’s that quote was like, what would you do if you knew you couldn’t fail? And I’m like, fuck that quote. It’s like to me it’s, what would you do if you knew you would fail? That’s what we’re compelled to do.
Jim O’Shaughnessy: That’s a much better question.
Jason Buck: Just run headfirst into walls every single day knowing failure is probably imminent.
Jim O’Shaughnessy: Yes.
Jason Buck: And if we do get lucky, great. But otherwise, that’s what it’s—not anybody would do anything. Yeah. What would you do if you couldn’t fail? Anything. I’d fly out this window.
Jim O’Shaughnessy: Right, exactly.
Jason Buck: But no, we’re compelled to do things. And this gets back to where you and I disagree about free will. It’s like I’m compelled to do this thing where it’s high likelihood of failure, but I don’t know anything else better to do because it’s just everything of who I am and this amalgamation of detritus I’ve collected from others throughout these years because I don’t even have any thoughts I can call my own. They’re really other people. I guess they’ve been uniquely put together into this body and brain. But that’s all I’m doing, is using those to the fullest extent of my abilities. I’m just giving my all into this. And if it works, if it doesn’t. Because we can’t help ourselves.
Crossing the bridge of nihilism
Jason Buck: Yeah, well, as you know, he’s a mutual friend of ours and he’s 100% right. Because part of it too is a lot of people in our position want everybody else to be entrepreneurs or think the way we do. I don’t want anybody to think the way I do. And I actually think entrepreneur is a bug, not a feature. I think it’s terrible brain chemistry. Right. The way society’s set up for bimonthly paychecks, a salary, and then you get a mortgage and it all makes sense. Right. It’s bond-like income. Why do we want this equity VC-like income? There’s something wrong with us. And just I know to you and me, Hypomanic Edge was a really important book to me in my 20s.
Jim O’Shaughnessy: Yes.
Jason Buck: It made me understand myself if I have this mild bipolar. Right. Because part of that bipolar is that you get all the positive effects of really being able to lock in and focus on things and build businesses where you’re creating an entire world that you’re the fuel for that. But it also comes with a commensurate downside as well. Right. The darkness.
Jim O’Shaughnessy: Yeah, well, everything does.
Jason Buck: Right, right. It’s just not a free lunch.
Jim O’Shaughnessy: No. And when I was in my 20s, I was just staring way too long into the abyss. And as you—you know the quote, it stared right back into me. And I was like—for a while, I was just like, why bother? Nothing matters. There is no truth with a capital T. There is no such thing as enlightenment. And the way I came to kind of figure that out because that leads to nihilism. And my thought was, well, okay, let’s assume that this is mostly right, even though I think it might be mostly wrong. Let’s just assume it’s mostly right. Well, what can I do about it? And I call it walking across the bridge of nihilism.
And when you get to the other side, you’re like, okay, well if life has no meaning and there is no such thing as enlightenment and there is no truth with a capital T, that means that I get to determine meaning. That means that I get to say what matters in my life. And so once I really embraced looking at the world that way, that’s when all of the dark abyss staring stuff didn’t end, but it was just like, oh, there’s the abyss again.
Jason Buck: Okay, this is why I love talking to you. Because it gives us time to talk about, pull on strings of nuance. And so you say you’re saying nihilism and everything. And I’ve always—everybody thinks nihilism is a pejorative.
Jim O’Shaughnessy: Right.
Jason Buck: But I think what got to the point, what you said is the true, I guess, definition for nihilism is there’s no grand meaning to life. Right. But like you just said, that means we get to make up our own quotidian meanings to life.
Jim O’Shaughnessy: Exactly.
Jason Buck: So our family, our friends, whatever we’re into, drinking or eating or whatever and just sitting in the park, having an espresso, that’s the meaning of life. Having conversations like this, that’s my favorite part of life. And so that’s what I mean. So it’s like, don’t you think that’s fair? It’s like, so you can be a nihilist on a grander meaning, but that’s totally different from making individual meaning on a daily minute-to-minute basis.
Transcript
Jim O’Shaughnessy
So, Jason, welcome to Infinite Loops. I love you for a variety of reasons, but when I look at your CV, it’s like, you’re a young guy and yet your CV, I would peg you at 87.
Jason Buck
Well, one, I appreciate you saying young guy because I’m 47, so I don’t quite feel as young anymore.
Jim O’Shaughnessy
From 65, that looks young.
Jason Buck
I know it does. But you always talk about being old, right? If we ask any of these guys in their 20s, I’m a boomer too, or whatever, I’m almost dead. So I appreciate that. But I do have a chaotic or circuitous CV in the sense that maybe what I didn’t realize is maybe I was always applying to work for OSV, right? I knew only it was for an audience of one. This has been in planning for 20 plus years.
Jim O’Shaughnessy
I admire your patience and your ability to succeed at all of these various things.
Jason Buck
Well, success may be, that may be overshot. Right. I think it’s probably a lot of failure and just stumbling from one failure to the next.
Jim O’Shaughnessy
So I guess the first question that I wanted to ask was how did all of the former things that you did—I mean, you were a great athlete, you did real estate, you did religious studies. I want to talk about that because I think there’s a lot of correlation between people’s investment beliefs take on an almost liturgical ring to them.
Jason Buck
100%.
Jim O’Shaughnessy
But what did you learn from the earlier stuff that helped you with the Mutiny Fund and the Cockroach Portfolio?
Jason Buck
So I think it’s really easy to connect those dots in hindsight. Right? That’s what’s always hard for us with that foresight. The way I think about it is you and I suffer from a similar affliction of insatiable curiosity. So ever since I was a teenager, I was fascinated by religion and just why people act the way they do. And obviously religion’s a huge part of that. And my mother came from an Irish Catholic family, and my father was a Zen Buddhist. But this was in rural Michigan in the ‘80s, so that was very rare. So we started meditating at a young age due to my dad and everything. He was also a triathlete and endurance racer, so maybe that was part of it as well.
So my parents said, we’re never going to give you a religion. We’ll let you kind of choose your own. So starting at 12, 13, I started going with friends to churches, synagogues. I just wanted to explore, what is this? Why are they all so enamored or obsessed by this? And part is, with religion, it incorporates everything. So when I ended up going to university, I actually originally started international business. That was really easy because I came from a family of entrepreneurs. So I just always had the gift for business, I guess. I always go, people say they’re entrepreneurs. I’m like, what were you selling in middle school? I was selling bracelets my sister and I made. I would make mixtapes and sell them at school. You have that in you.
Jim O’Shaughnessy
Hall passes for me.
Jason Buck
Hall passes, you could sell. You found a pad you stole from the teacher.
Jim O’Shaughnessy
Of course.
Jason Buck
So perfect. It reminds me I was the worst kid in the sense that I would skip school, but I would leave during first period and I’d go to the library and I’d spend all day in the library.
Jim O’Shaughnessy
That’s not a good truancy effect.
Jason Buck
No, I should have gone to smoke cigarettes behind the local convenience store. But no, I went to the library. What I found through eventually switching to comparative religions, it incorporated everything. Because I was fascinated by history, philosophy, art, sociology. And really, that is the foundation of all of those things that come out of that is the way I thought about it. So it was a never-ending quest for that insatiable curiosity.
I also found interesting while I was studying comparative religions and I played D1 soccer at College of Charleston. Eventually I also had to get a job and I got jobs in restaurants. And eventually I leaned towards the sommelier wine side because once again, it was insatiable curiosity. So you could learn about every varietal of wine in the world. But every year a new vintage comes out and you basically have to reset that knowledge base. So once again, it was insatiable. It was the never-ending rabbit hole that I knew I could never quite satisfy.
So then after coming out of school and studying comparative religions and everything, I spent time living with a Buddhist Rinpoche. One of my mentors was a Hopi Indian shaman. I moved to Istanbul, Turkey. And everybody’s maybe heard the story where I sold Turkish rugs on the streets of Istanbul. “Hello, my friend. Would you like a cup of tea?” That was me. And this is in the late ‘90s, the first time I went there twice. And it was always interesting to me because all these Americans coming off of cruise ships or whatever, if they saw a blonde Midwestern white kid, they immediately trusted me versus a local, which they shouldn’t have. I mean, I always took care of them. But you’d sell them a Turkish rug and they’d be like, I want a leather jacket. It’s like, great. I know a Russian guy that makes leather jackets. I need a good restaurant. I go, great, take them to a restaurant. You circle around the block, you come back, and the restaurant owner gives you [inaudible]. I like the way that economy worked, I’ll put it that way.
But I was really doing, when I was in Istanbul, I was actually also living with the Mevlevis. So the Mevlevis are a sect of Islam that comes out of the—colloquially known as the whirling dervishes. So they trace their lineage back to Rumi, but once again, it’s the esoteric version of Islam. And so I was studying with some of the sheikhs there, and that’s why I was living in Istanbul.
And eventually, we talked about this before when I was at your house, eventually you get to the point where no matter if it’s Buddhism, whether it’s the Mevlevis, whether it’s any sort of shamanic tradition, they think they have secret knowledge. And so it got to the point always where I was like, show and tell time. Put it on the table, what do you have? And of course, they never had anything, right? It was always in the future. It was always pushing those goalposts away, always. And so eventually, I just kind of gave up on that part of my life. And I was in my mid-20s. I gotta make some money and those sorts of things.
So then I got into—my family has a past in kind of a little bit of real estate development on the residential side. So I fell in love with commercial real estate development. And so I did a lot of development projects in Charleston, South Carolina. So I stayed there, developed a lot of that King Street corridor. But then 2007, 2008 came as we were just talking about this beautiful apartment, and that crash was so painful that it changed my life pretty dramatically. Like every young man, I thought I was a genius, right? You become a multimillionaire in your mid-20s. You could do no wrong. This is just a dot plot on the radar. On my way to a billion by 32, right? Who’s gonna stop me? I’m clearly smarter than everybody else.
And you found out a rising tide lifts all boats and it shut it all down. And so the pain of that was so acute that I spent the next few years just trying to figure out, how do you hedge global macro risk? So that way as an entrepreneur, you can go as hard as you possibly can into your idiosyncratic business. So that’s kind of what led me into this whole investing space and long volatility, tail risk, options and thinking about defensive strategies for entrepreneurs.
Jim O’Shaughnessy
And it’s a similar story with a different path for me. I just, from a teenage—I was 17 or 16 and my uncle and dad would be arguing about stocks and I just got the bug. It’s like neither one of these guys know what the fuck they’re talking about because they’re talking about this CEO and this, and it was all surface stuff. And I’m kind of like, don’t you think you should look at how much you’re paying for every dollar of earnings or all that? And so, but what I loved about it was it is the perfect spot for somebody who is insatiably curious and loves to go down rabbit holes.
We were talking about religion, you were just recounting all of your various experiences. I think that religion and religious attitudes inform far more than religion. Right. I think that, you know, you think of Bogleheads, you think of the various, no, I’m a die-hard fill in the blank. And what’s interesting about religion compared to the scientific method is that you can be consistently wrong with all of your predictions in religion and gain adherents.
Jason Buck
Yeah.
Jim O’Shaughnessy
I think of the Seventh-day Adventists—not to pick on them because I’m sure that they’re lovely people. But that was a guy back in the 1800s who started, mathematically proven through the Bible, the world is going to end. I can’t remember, 1846. Right. And so literally he got a hundred thousand people to sell everything, wear white robes waiting for the rapture, and nothing happened. He was like, oh, I got something wrong. And he went back and he ran the numbers again and he came up with a new date. Of course, wrong. And yet there are now 18 million members of this particular sect that descends from him. And it’s not just him. Right. It’s like every major religion makes all of these—it’s coming soon. I always joke the world’s oldest profession is not prostitution. It is predicting the end of the world.
Jason Buck
That’s very fair. What’s the—I’m always terrible at pronouncing this word—millenarianism. Yes, yes. The end of the world. That’s what most religions are at the end of the day. But what you hinted at that I find so fascinating that I’m working on is I do take my background in comparative religions and now I’m applying it to investing and portfolio construction. Because like you said, I always like to mess around with my value-based brethren. I mean, inherently you got to love value-based in general, sure. But now they worship the Buddha, like Buffett, right? And whatever he says from on high, that’s gospel and you can’t tell them. But as any faith-based religion, it’s the pain in the interim, right? Going the past decade without value. No, if we just hold the course, if we just stay strong, right, we’re all going to be lifted together in this rapturous moment. And value, everybody’s going to get their comeuppance in the afterlife, right?
Jim O’Shaughnessy
And you know, that’s another big part of it, right? You see it in market behavior all the time. The people—we had value strategies, we had momentum strategies, we had a variety of strategies because the evidence suggests that on balance they work more often and with better predictability, if you want to call it that, than other strategies. So I in the beginning, like everyone else, read all of Graham’s books and found it compelling. But I also was like, wow, this Mandelbrot fellow is a very interesting guy because I’m sure you’ve read of course that chapter in which he just dissects and just—it doesn’t leave anything living from efficient market theory. Right? But isn’t that an edge? Isn’t it an edge for an investor who’s very happy to fade those consensuses and go their own way?
Jason Buck
Yes and no. We’re getting into a different topic that I find fascinating, like edge or alpha. I’m not sure any of it really exists. There are edges or alpha in arbitrage hunting, right? But you have to persistently arbitrage hunt because they appear and disappear so quickly and it’ll be in a different marketplace. That’s a true edge. But those are extremely rare. And so you go back to kind of efficient markets. But like you’re saying, what mine came from too is people, I find when they’re young, they either start with Buffett and then that just locks in from a young age. Right. That’s part of it. Or like I did, they start with Market Wizards. I kind of started both the same time.
But I loved Market Wizards because you find from reading the Market Wizards books there’s a million ways to make money in the markets. You got to find one that works with your personality so you’ll stick with it, which is really Buffett’s secret. Who else has done the same thing for 80 years? And compounded as we know it, all the wealth came later in life. Right. So that’s the unique part of it. But what I found even reading Market Wizards is a lot of times you had these CTAs or trend followers and it was like trend following plus nothing. They just thought that was the cat’s pajamas. Right. There’s nothing better than that.
But then you run the numbers and you’re like, well, if I pair that with long-only equity beta, I end up with a better portfolio due to the uncorrelated nature. And because they were faith-based in trend following, then they wouldn’t apply that. But now you’re starting to see that last few years, you’re seeing a lot of mutual funds and ETFs come online. They’re pairing those two together. So it comes down like you’re saying, this portfolio construction of all these different strategies that work at different times and all these asset classes that work at different times, whether inflation, deflation, growth or recession, if you pair them together, they all kind of muddle along in a symbiotic relationship. And your timing mechanism can just be rebalancing.
And so to your point, that’s maybe where you’re harnessing a bit of edge or alpha from the behavioral aspects of people. Because you kind of just watch money chase all of these asset classes around the world. What’s the hottest these days? Right. But then the hard part is if you have true portfolio diversification, there’s always a part of your portfolio that you hate. The news media is telling you to hate it. You’re an idiot for owning it. It makes you want to throw up. But if everything’s going up together, you’re not diversified. So that’s the hard part. I think it’s like Brian Portnoy is like always having to say you’re sorry.
Jim O’Shaughnessy
Yeah, I’ve said often that the less sustainable edge, if there is edge at all, is to arbitrage human behavior. Because literally human behavior has moved very little, at least over the recorded history I’ve been able to study, whereas markets—people confuse the climate with the weather. I think weather is obviously very changeable. It’s a beautiful day here now. It was raining yesterday. Climate is very different. It’s a lot more sticky and sticks around. And I too looked at the world in much the same way you’re describing right now. It’s kind of like you’d never know when you’re going to be right and how much pain it’s going to cause. I actually use that as kind of an indicator. If everyone was telling me, you’ve got to drop this strategy, it’s awful. We’re getting fired in this strategy. Everyone hates us, they’re yelling at us. I would put money into it just because it just seemed like a sensible thing to do.
Jason Buck
Tomorrow I’m going to—I’m going to London tomorrow and I’ll see Jerry Haworth from 36South out there. And he’s one of the OGs of kind of the long volatility tail risk space. And he told me once that the only way he can predict when the next market crash is coming is when he has the highest amount of redemptions. He just knows it’s around the corner, right? So once again, arbitraging human behavior. And then the event happens and then everybody rushes to invest because they want a time machine, right? When did Noah build the ark? Before the flood. Before the flood. But everybody comes in after the flood. So that’s what you’re saying. The arbitraging of human behavior is odd to me.
And our mutual friend Meb Faber always says too, when people call him up to talk about one of his ETFs, he’s like, oh, the one that’s down the most. And no, it’s never. It’s the one that’s up the most, right? It is just inevitable. Over and over. But I am sympathetic or empathetic to the idea that human behavior is hard. I think you’ve talked about it before. This is why I also love our business. The P&L every day is black and white. We have a connection with reality that you may not get in a narrative religion where the end times are down there tomorrow, always tomorrow.
Jim O’Shaughnessy
What did you do today?
Jason Buck
Right? What did you do today? And your P&L could tell you you suck every day, right? Or even worse, what kind of job can you go to and lose money for months on end? Right. It’s only a job like this. Obviously, being an ER doctor, ER nurse is much more important than what we do. But it’s an interesting feedback mechanism that we get about reality. And therefore, yeah, you have to think very carefully about what your portfolio looks like over time. But the fairness for the human condition is—it’s one thing to have theoretical inputs and the philosophy and the back test and know through time I’m going to be fine over decades.
But the lived experience, day to day, it just plays on your emotions much harder than people could ever imagine. I always—because we work with a lot of younger investors that had their first liquidity event and they sold their business. And one of the things that’s interesting to me, they always tell me, if the market’s down 50%, I’m a buyer. And I just laugh hysterically every time because it’s just like, you have no idea. But understandably, they don’t have the experience for it. And I think Jason Zweig said it best, I can draw you a picture of a snake, but if I throw a snake in your lap, you’re going to act very differently.
And so what they don’t know is if the market’s down 50%, you’re in the fetal position on the floor, you’re going to ATMs to try to get your cash out. You think it’s the end of the world. The idea that you’d want to buy stocks at that point, you and I have been through this, it’s anathema. Hopefully over time we get enough experience. And then we’re like Howard Marks, and we’re like, well, I have to be buying now or else I’m in an existential crisis either way.
Jim O’Shaughnessy
And I wrote while I was still in asset management, very few pieces that predicted anything, because I’m kind of in your camp that predictions—make them early and often and then cherry-pick the ones that work. But I do write them when I just feel the data shouting at me like, Jim, you got to share this. And so I wrote one in February of ‘09 saying a generational buying opportunity. And the hate of the emails that I got after I published that was very much like when I wrote The Internet Contrarian in April of 1999. That was worse because, man, living through that period, it was just surreal. Literally everyone had drunk the Kool-Aid. All of the priors were correlated.
And when that happens, you go from heterogeneity of opinion to homogeneity of opinion that causes information cascades and it’s like a tsunami. You’re watching, right? And you’re like, I don’t agree.
Jason Buck
Yeah.
Jim O’Shaughnessy
And then you get swept up. And just as proof of that point, what did I do? I started an Internet company. So if you think you’re impervious to the water in which we swim with our fellow humans, you are wrong. And it’s very difficult. I got very inspired by John Templeton, who put orders in way below where the shares were trading. And when asked, he was like, oh, I wouldn’t have the courage to do it if they ever got to those prices. And so I did kind of train myself with that instinct, like Meb. Right. You take the one—if you think the strategy is still sound and you think it’s going to work, that’s not a bad move.
But also you mentioned earlier rebalancing, Jason. Trying to convince a prospective client that your rebalancing discipline is what is responsible for much of your success. It’s like I’m pretty good at coming up with ways to persuade people. I just never came up—I mean, they would just literally stare at me like what? Just rebalancing.
Jason Buck
It’s a form of timing mechanism too, in a way. Non-predictive in a way. So we could also argue if it’s implicitly mean-reverting, is it a short vol trade or not. But maybe you have long vol components to your portfolio, but it’s affecting the hubris effect, as we both know all too well. And my good buddy Corey Hoffstein wrote a book about rebalancing timing luck. A lot of times when we look at the great returns of investors, there’s a lot of timing luck to it, whether we get into ergodicity or sequencing risk. And so you and I are trying to mitigate that as much as possible.
And that’s what I look at. If I hold all these offense and defense and all these world’s asset classes and I’m rebalancing between them, not only is it helping me scale trade kind of those equity curves as they go, so I’m forcing myself into the best behavior possible, I’m buying into a drawdown and I’m selling into the upswing and I’m rebalancing to other asset classes that may be doing similar things or countercyclically or negatively correlated. And so to me, it just inherently breeds that discipline that you would get from a quant effect by having a timing tranche for the rebalancing effect. It allows me to not override or oversee those things in a way. And then ironically, you do actually, if you have truly uncorrelated, negatively correlated, and some volatile assets in there, you actually get a rebalancing premium. You can make an extra 2 to 3% a year just on that rebalancing effect.
But I always think about how hard it is, like you’re saying, to sell it to clients and everything. I think about my own father who’s in our funds, right? And I’ve been talking to him about these ideas for 20 years. And in 2020, he made a bunch of money off long vol. Now you have to rebalance into stocks at that lower NAV point because that’s how you compound. Well, and then as you know, through the end of 2020, stocks rip. And he’s like—and I’m like, at the end of 2020, it’s rebalancing time again or whatever. And he’s like, but my stocks are up so much and this long vol is down so much. And I’m like, what have we been talking about for 20 years? It’s just like, no man’s a hero in his own family either. That’s also a lesson we all learned as well.
Jim O’Shaughnessy
That’s quite true. Something I live with every day. Let’s go back though. Let’s talk about the experience which was obviously painful for you, and then why it sparked, what it sparked that led to the way you manage money. I love the name of your portfolio, the Cockroach Portfolio. It just, every time I see it, I chuckle. And it’s the best kind of form of anti-memetic behavior because you’re just immediately excluding all the people that were like, yes, cockroach.
Jason Buck
So in fairness, everybody told me not to call it that, and I understand it, but I was like, wait, what do cockroaches do? Right? And I don’t have to say anymore. You know the philosophy of what we do immediately.
Jim O’Shaughnessy
Totally.
Jason Buck
And then it’s visceral. So you also remember it because if there’s 10,000 hedge funds out there, how do I cut through the noise? Ironically though, we just did have an investor redeem because he said his wife was getting tired of the disgusting cockroach emails. So this is what you deal with. So the experience in that after the 2007, 2008, right, for lack of a better term, probably existential crisis, figuring out what I want to do with my life, everything I thought I knew and the genius I thought I was crumbles beneath you and you realize your mortality and probably more the opposite, you think you’re a complete moron, right?
Because it’s one thing as you know, to lose your own money, but if you lose friends and family money and everything, it’s absolutely devastating because these people believed in you and all that stuff. And so it’s almost like a double layer of existential crisis in a way. So in fairness, it probably took me years to even come to terms with that and kind of understand what happened and take full responsibility for all that. Because even though it’s a global liquidity event, you want to tell yourself you should have seen it forthcoming, there’s things you would have hopefully done and thinking about in hindsight, which helped lead me to create things now.
But part of that process was I was very—I’ve been very lucky in my life. Let me start from the ovarian lottery, right? I was born a white male in America, in the upper Midwest. Doesn’t get any better than that. And then was lucky enough, a family of athletes. I was a good athlete. My brain works great. I have a decent memory. So my whole life I wanted to be a D1 athlete. So I found, I did that. I found that to be hollow right then. I was like, everybody, I wanted to be a millionaire. And a net worth millionaire on paper, we’ve talked about this before, doesn’t buy you a cup of coffee, kids. But I found out what it’s like to be a millionaire and how banks and everybody treat you then. And I found that to be hollow as well.
I found what I thought was the love of my life, found that to be hollow. Just all these real life events, I found them to be hollow. And by 30 years old, I’m like, well, I’ve conquered everything I wanted to do. Kind of what do I want to do now? One of the things we talked about before is then I had the hubris still at that time somehow where I was like, well, all these individuals have been enlightened before. I’m like, if anybody can do it, then that means I could do it too, right? And so pursued that path to only find out enlightenment doesn’t exist, which I’m sure you’d love to talk about later. But so all of that, it ends up though that insatiable curiosity has never left me.
And one of the things I’ve always been obsessed with is generational wealth or investing or what do you do with your money, right? You have money comes in, you consume whatever you need to consume. If you have anything left over, that savings, what do you do with that savings to make sure you’re okay? So that’s what obsessed me, because I came from a family, went from shirtsleeves to shirtsleeves in the job shop manufacturing community. So I saw it happen from my great-grandfather started something that my grandfather ran, then my dad, and then it was completely out of our family. And so this always obsessed me. And so thinking about how do you survive in these environments and then always be an entrepreneur and think about other entrepreneurs. I got obsessed with defensive asset classes, right?
Nassim Taleb, tail risk hedging. Another offshoot of that is the long volatility programs. And then you can think about the commodity trend followers. They protect against inflation or kind of differentiated markets or we have breakouts that are uncorrelated. So it’s like, how do you combine correlated, uncorrelated, negatively correlated assets together to build this robust portfolio that can kind of muddle along in any of the four economic quadrants? Like we talked about, inflation, deflation, growth, recession. So it was just that obsession over time that led me down this path of I taught myself how to trade volatility, especially the basis trade. I traded options and then eventually figured out I was probably a better entrepreneur than a trader. And a member of my family read Nassim Taleb’s books like Black Swan. They’re like, hey, how do I—tail risk hedging looks interesting to me. And I’m like, well, Taleb’s connected with Universa and they want 100 million plus. This is an institutional hedge fund and there’s nothing for the little guy.
So I thought there had to be a way to construct that portfolio. And it took me years to figure out what that path would be. And as you know, the wrapper and everything that goes into building a business in finance with all of our oversight, but eventually figured out how to do it for my friends and family and aggregate them together to get those access to QP funds and those sorts of things.
Jim O’Shaughnessy
And do you find that your client base, and this is a horrible way to phrase it, do you think that when they give you money, they really, truly understand what you do?
Jason Buck
Man, like a samurai, you went right at the heart of it. Right? So the way I think about it, we’ll get down to that part, I try to fire as many potential clients as possible. So we’re out here, we do podcasts, whatever. We bring people into that funnel, and as they come down the funnel, they eventually get to me. I want to make sure they truly understand what we do and they need it like water in a desert. And ironically, most of our clients have been engineers that have tried to build what we built and knew the difficulty of it. And they’re like, oh, thank God you built this. Please take my money. Right. And so they fully understand. We go through that process and they completely understand what we do. Right.
As you know, the harder you have to sell, the hotter that money is. Right. And so it’s a weird thing. It’s like you have to sell what you’re doing to get people in the door, but if you’re pitching harder and harder, you get the money initially, but it’s gone quickly. So you want to make sure you have the best clients. That’s why I say, I’m trying to fire all the clients and try to say, go here, there’s better options for you. But eventually we get down to that client. Now, the heart of what you’re saying is something that I think about way too often is that I know everything that’s gone into this portfolio, every decision we’ve ever made as the thousands of decisions that have gone into that portfolio.
And knowing every time we try to make the best decision outcome as possible and a lot of time at our own detriment. Right. But you don’t know that unless you’ve been in that room and been part of those decisions. Right. And so I have that full faith-based system in what we do because I’ve been there since the beginning and my team’s been there since the beginning. So we’re all easy investors in the fund. Like you said, people can understand, they think they understand theoretically and philosophically with what we do. But as soon as times get tough, that’s where you really find out if they believe in it or not. And unfortunately, it comes right back to faith-based dynamics and basically religion.
Jim O’Shaughnessy
Yeah. And I love the way you avoided my question, by the way.
Jason Buck
Did I avoid it? I probably did. I’m going to try to be evasive about all your questions, but nail me down.
Jim O’Shaughnessy
I asked that question because of the many decades I spent with clients.
Jason Buck
Very difficult.
Jim O’Shaughnessy
And I found that, like you, when I started out, I tried to sort for clients I did not want. And so, as you know, we’re empirically based algorithmic quants. And so rather than bring in here’s the best results of this strategy, I would always bring in the 10 worst drawdowns and just watch them, watch their reaction. And that seemed very effective until it got overrode. You know why they were sitting opposite me, right, Jason? They were sitting opposite me because the fund was on fire. And me showing them all of the—and some of these drawdowns were horrific, right? Like 55% drawdown. And it didn’t touch them. And I learned to my detriment that when the fund started doing poorly, guess who were the first people to fire me?
And so it was something that I always really struggled with because I’m a big believer in level playing fields. Right. I did everything wrong. Right. I had a relationship with Merrill Lynch providing stock selections for their UIT program. And I was launching four no-load mutual funds. And Merrill called me and they’re like, why don’t you do load, man? We’ll put you on the system. And we could move you a lot of product. I’m like, no, load funds are dinosaurs.
Jason Buck
Yeah. And they’re still around to this day.
Jim O’Shaughnessy
And they are still around to this day. Well, because you realize a friend of Patrick’s has this great demarcation, is someone pre-fall or post-fall. And it’s very useful. I don’t usually like these dichotomies because they miss so much.
Jason Buck
There’s two types of people in the world. The people that believe there’s two types of people in the world and the people that don’t.
Jim O’Shaughnessy
That’s right.
Jason Buck
This dichotomy, though, I’m curious how you—because, okay, we both have this very egalitarian ethos. Right. That runs through everything we do, but at the same time, we’re both hardcore observers of human behavior.
Jim O’Shaughnessy
Yes.
Jason Buck
And sometimes those are in hard conflict with each other.
Jim O’Shaughnessy
Sometimes.
Jason Buck
Right. Like you said, I’m highlighting the drawdowns and everything, but I know as soon as you have a run of good returns, this is why everybody’s talking to you. But you’re running a business, so you’re like, do I strike while the iron’s hot. I know I should be shouting this from the rooftops, but it feels skeevy to me. Right? But this is human nature. And then when we’re in drawdown is when they should be allocating to you, but they’re never going to. So it’s almost like you shut off the marketing efforts during that time. I mean, we try to just keep it consistent. And I just try to build a portfolio that I want and my family wants and hopefully other people like it too. But that’s what I’m saying. How do you deal with that?
Knowing exactly what they’re going to do is the exact opposite of what they should be doing. But I guess the hope is your product you believe is the best option for them, even though they may be buying in at a high point in NAV, instead of buying in at the low point in NAV. But at least you know what you built. And maybe that gives you the comfort of having that discussion or potentially taking their money. I mean, you know them better than I would.
Jim O’Shaughnessy
You know, ultimately you’ve got to believe in your process, right? In fact, at OSAM, we had a rule that the only long-only equity portfolios or stocks people could buy were through one of our portfolios. We didn’t allow trading of individual names. We didn’t allow speculative stuff. And everyone’s pretty cool with that. We just passionately believe chefs should eat their own cooking. And another thing that we instituted, which, it boggled my mind that I didn’t see other managers doing this as aggressively, is the one rule was, when we are shitting the bed, we are all on the phone, all of us on the phone.
And the number of anecdotes I can give you, I mean, I wish I would have kept hard data on it, but they’re anecdotes where the people would say, you know, you are the only manager who’s calling me. And he goes, I’ve been sitting here trying to get my other managers on the phone and they’re all too busy or whatever. And I just think we’re back to human nature yet again, aren’t we? Because that’s just the way we behave. And so while we always did try to qualify the client and make sure that what we were giving them was going to be right for their particular situation, we did attempt to get clients to show us their overall allocation. And you’d be surprised by how reluctant many people are to do that. But it’s a matter of course, kind of for you, right? Or are they just adding you as a bolt-on, come the meteor hitting earth?
Jason Buck
It depends. So our overarching Cockroach philosophy holds passively global stocks, global bonds. We have a long volatility tail risk on, a long commodity trend on, a little bit of gold and cryptocurrency. So it’s all the world’s asset classes. So it is a set it and forget it. Great for you. The hard part is when people ask me, how much should I allocate? It’s like, well, I built it. I put 100% of my money, my family’s money. I think you should put 100% in. But nobody in the industry says that. Right. So it’s like, or if I’m talking to a wealth manager, it’s like, okay, put 10% in us and then you’ll forget about us for 10 years. And I’m clipping that coupon, right. And they’re like, you can’t say that. I’m like, but that’s how the industry works, right? It’s this radical sense of human nature.
But yeah, so I mean, that’s the way I believe. But then also what if I’m idiosyncratically wrong? You should still have some diversification outside of us. Right? It’s not that simple. And right now we’re just trading kind of the world’s liquid asset classes and there’s this whole world of illiquid private asset classes that would be a nice complement to a portfolio like that. I’m curious though, your hardcore thinking about human behavior as, when you picked up the phone, not only was that important to you in that drawdown to pick up the phone, but you also knew in the back of your mind that was going to keep clients invested. And so this is one—another thing I have a real problem with is we were saying earlier, the P&L is our black and white. There’s no faking that. Right. But then every month or quarter, everybody does their write-up about that month or quarter. Now I hate that part. I’m like, the numbers should speak for themselves. You can judge us on those. But I do know, and my partners know that this write-up and this narrative is what keeps clients invested. And that’s another opposing forces I have a really hard time with.
Jim O’Shaughnessy
Yeah, it’s a challenge. And our default was always to be as, just bluntly honest as we possibly could be. And in our case, what we would do is, if we were really shitting the bed, we would go back and analyze all the other times we were really shitting the bed and try to at least put context into it because we did truly believe that particular portfolio did belong in that client’s portfolio. But it’s the hyperbolic discounting that is yet another thing that we humans are great at. And literally that’s by the way, because I want to get back to the exact experience that happened in ‘07-’08 with you. But during that period we literally had a bunch of our, who I viewed as incredibly sophisticated clients, literally taking $250,000 out of the bank and putting it in a safety deposit box.
And I would just be like, that’s probably not an optimal strategy for you to do here. But we lost a lot of clients because when all the correlations go to one, people need liquidity. Right. I saw so many really great shops and I mean that, go out of business because they were a source of liquidity. Right. And you mentioned private marks. We do a lot of private investing now. And one of the things that really bothers me is that they are not marked to market on a daily basis.
Jason Buck
The vol laundering of it is beautiful.
Jim O’Shaughnessy
It’s—but it’s like borderline.
Jason Buck
It is but…
Jim O’Shaughnessy
Come on.
Jason Buck
As we both know, it’s incentives all the way down. And I don’t think people realize how much the actual allocators are complicit in that. Because if you’re at a mid-level seat at a pension or an endowment and you want to keep that seat and you want to compete with the other Ivy Leagues. So that’s the other problem is they put all of these endowments on a leaderboard table. Right. Coming out of Swensen. So everything has an opposing force. It’s like Swensen was great with the Yale model, but then it created ideas that we’d have superstars at these universities. And so now they have a leaderboard they’re trying to keep up with. And so if I’m sitting in that seat and I know if I allocate over here, we’re only going to have positive returns, no negative returns.
And if anything does happen, it’s probably 10 years from now and I’ve already switched my seat two or three times. Right. So why wouldn’t I allocate to the people that are making up their own marks?
Jim O’Shaughnessy
Yeah.
Jason Buck
So it’s just like, that’s what I’m saying. It’s turtles all the way down. So it’s—we’re all complicit, I feel, in a lot of that stuff.
Jim O’Shaughnessy
Well, I agree. And actually, before we started recording the podcast, one of the things I wanted to talk about was ‘07-’08, because that is where I started getting pissed off because I saw that everyone was complicit. Everyone. The ratings agencies, the banks. The banks knew that they were hawking shit, but they were encouraged to do so by the government, who always tends to like, we didn’t have anything to do with it. Oh, well, know your history a little bit. You actually did. And then the thing that offended me the most was nobody went to prison. And that talk about existential.
For the guy who was around for the savings and loan crisis, when more than 1,000 senior executives of those companies went to jail, and real jail, not country club jail, and that I really had to think deeply about what that implied. My thesis was, everyone is complicit here. Not just this group or that group. It’s everyone. And the government, which is supposed to be the referee, isn’t refereeing. And I’m like, this could be bad.
Jason Buck
It’s moral hazard all the way down. But it’s interesting, like you said, everybody tried to blame people getting liar loans or ninja loans at the time. And everything was like, who gave them those loans? We just went all the way up to scale. And it’s a diffusion of responsibility.
Jim O’Shaughnessy
Yes.
Jason Buck
It’s the same thing. We know if something happens in the park down there and everybody goes to help, instead of pointing at somebody saying, you call 911. It’s a diffusion of responsibility effect.
Jim O’Shaughnessy
Yep.
Jason Buck
And also be clear, I knew that people buying the condos and the developments I was doing. I saw the no income, no verification loans they were getting. Right. And I turned a blind eye. Right. Because I was trying to sell the project out.
Jim O’Shaughnessy
Sure.
Jason Buck
So I’m complicit in that. And then also, like you’re saying, I think about this way too often, picking up the phone, everything. I did not handle it well. In 2007, 2008, I was in my mid-20s. A lot of hubris. I probably went more into turtle mode than picking up the phone. And so I did a lot of things that I’m not proud of that I had to reconcile and deal with from that experience as well. And part of it is I saw the writing on the wall. But it was interesting, too, at the time, I think it was late 2006. It’s always interesting. Real estate guys say 2007, financial guys say 2008, right?
But in 2006, I remember I got—I was young, naive, and so I got together some of the best or oldest real estate developers in that whole Charleston era. It was six guys, and all of them were over the age of 50 at the time, whatever. And I asked them, I said, look, I don’t have context. What do you think is—to a man, they said, this time is different. Right? But unfortunately, I learned a hard lesson in life that commercial real estate developers are the most preternaturally optimistic people on the planet, right? And as you know, they just declare bankruptcy and start over. Don’t think about risk. It’s all just YOLO, long 24/7, right, with leverage. So I learned that harsh mistake where I thought I was being smart. I clearly wasn’t. I truly didn’t understand human behavioral dynamics in my mid-20s.
Jim O’Shaughnessy
I had a different experience in my mid-20s, and it was our family. I briefly ran a real estate operation that our family had done a bunch of investments in, primarily residential, commercial apartment buildings. And the Reagan tax reform went through, and I went and called on those same old guys, and I’m like, this could be disastrous for real estate because they’re taking away all the goodies. And they were all like, you’re just a kid. You have no idea. They’re all going to come back in. You don’t need to worry about it. And I’m like, would you guys like to buy our apartment buildings? And they’re like, hell, yes. So I sold everything. And like you, if you know real estate, you know what happened for many years after those tax reforms went into place.
So I just chalked it up as I was just dumb luck. It’s like I didn’t have the—it was because I’m also a context guy, right? If you don’t remember anything that happened before you were born, said Cicero, you remain forever a child. And but this was an instance where the lack of context really helped me because I’m like, that law looks really bad for this type of real estate. But I think that the quality that I really admire in you is you are very open about fucking shit up and learning from it. And that was the great unlock for me was I am going to screw things up all the time.
And what I have to do is I have to look at that as an opportunity to learn something, to modify my mental model, to modify what I do in the world, et cetera. And I see that in you. So, I mean, it’s one of the reasons I’m so fond of you.
Jason Buck
I guess I’m still surviving with all the scar tissue, but perfectly like you said, it always fascinates me. I don’t have kids, but I always think about child rearing because, as we study childhood psychology, we learn more about philosophy and all those things. So I’ve always been fascinated by it. But one of the things we do is, right, we want our kids to have a great life and we don’t want them to make mistakes that hurt them. But yet everything we’ve learned is by making mistakes. It’s this weird once again, contradiction that we deal with in life. And then I’ve always, I’m a student of history the same way you are, and I really started studying my industry and the history so I don’t repeat those mistakes.
But yet every time it’s so slightly different that you get caught up in it. Right? So it’s like I’m fooling myself, right? That oh, no, I have knowledge of this. It’s like, no, each time will be so slightly different that you’ll get caught up in the fervor. Right? And you’ll maybe be like, oh, in hindsight you’d be like, I was an idiot again. And I always hated that quote. That was like, what is it, a genius learns from others’ mistakes? Yeah, I’m like, where are these geniuses? All I’ve learned from is my own mistakes. And like you said, I’m trying to make as many a day as possible, but I’m trying to suck less every day. That’s how I look. I’m not getting better or smarter. I just hopefully suck a little bit less every day.
Jim O’Shaughnessy
Yeah.
Jason Buck
And that’s, it’s like, I think there’s great—did you ever—was it Shopsins? Was there a restaurateur here in the city? He had a diner. Did you?
Jim O’Shaughnessy
Yeah, yeah.
Jason Buck
I Like Killing Flies was the name of the documentary. One of the greatest of all time. And there’s this great line he has. And it’s like the key to life I try to teach my children is you’re just a piece of shit, right? And every day you might do something that makes you less of a piece of shit. You might walk an old lady across the street. But you should just start from the metric that you’re a piece of shit. And occasionally you do something kind. It always resonated with me, I should say.
Jim O’Shaughnessy
So again, it’s ‘07 if you’re a real estate guy. It’s ‘08 if you’re a market guy. What happened? I want to hear the story, Jason. I want to hear what happened that would cause you—I understand the rabbit holes, and I understand your nature pretty perfectly because I have a very similar nature. But what was the thing that ignited the, I have to completely reinvent the way I think about this?
Jason Buck
Like we were talking about, I think it’s pain more than anything else. And I thought I had a handle on things, but almost like we were talking about, each time’s different. So it’s like those Minsky moments, right? Stability breeds instability, but we don’t know what’s the aggregate tipping point, right? That’s the hard part. So I was already worried about those things. And I just thought I had—I thought I had life nailed down. I really did. It was one of those things where to me, wealth is going out to eat and not looking at the price on the menu. That’s one of the forms of wealth. Obviously, your health is more important than that. But I remember that time was like, oh, I’m not pinching pennies to buy a burrito or something.
I was like, oh, God, I got life nailed. It’s super sweet. It’s just all upside from here. And so I think it was that jarring juxtaposition of the crash and to make matters so much worse, the hard part. And this is what led to kind of the tail risk hedging is no matter—in real estate, you’re developing projects that might have one, two, and five-year timelines. And so you’re doing all of these. And so it gets into this idea of ergodicity and time horizon and sequencing. If you then have a liquidity crash in the middle, there goes all of your model. There’s your DCF. Fuck DCF. It didn’t have 2008 or COVID in my DCF, so to speak. And so that crash felt so bad.
But what was even worse is because I had clients that were getting all these loans to buy the buildings I was renovating or restructuring, I could see who the worst and most complicit lenders were. The WaMus of that, the Countrywide, all of those. Right. So I knew because it hit 2007 first, I’m like, this is going to cascade into 2008 in the financial markets. Gets even better. So I’m like, oh, I know how to trade options. I’m going to start buying put options on all these home lenders that I know are complete garbage. I lost money shorting the housing lenders that went bankrupt. You know how this works. And so the pain of that is I had to teach myself what are the true options Greeks, the first order, second order.
Because I thought I was just making a bet on going down. I didn’t realize it was the price I was paying for the implied volatility and going very short-term time horizon as well. I was trying to just nail that move. And so it was, not only did I go through the pain of that crash, any savings I had left over, I was trying to short the markets to make up for it and lost that money as well. I mean, you don’t hit rock bottom till you hit rock bottom.
Jim O’Shaughnessy
No, you don’t.
Jason Buck
And so, yeah, and I’m trying to think what the hard part is, as you know, was Adam Smith talked about the vivacity of impressions, right? And so at the time, that was, I literally fetal position on the floor. But now that we’re talking about it, what, almost 20 years later, it’s a story that happened to somebody else. So I’m trying to put myself there to answer your question and really walk through it. But as we know, we don’t have the detail, we don’t have all of the little things that happen because it’s just, it’s become only a chapter in the book anymore and our memories suck, as we both know. And so I don’t know if I’m answering the question.
Jim O’Shaughnessy
No, you actually are. And it also leads to some interesting jumping off points because…
Jason Buck
I also, to be fair, also had to move in with my mother too. So that’s—this is probably what you’re getting at too, there’s some—see, it comes up when you ask, right.
Jim O’Shaughnessy
I think we might have uncovered something here.
Jason Buck
So part of it was, so you go through riding high in the crash and everything. And then at first I went and went to live with my sister in Chicago because she was doing her medical degree at the University of Chicago.
Jim O’Shaughnessy
Wow.
Jason Buck
But she’s a few months out from graduating with medical degree, so she has no money. Right. Of course, it’s all loans and everything. Right. So she would get jobs at Whole Foods and Trader Joe’s handing out samples or on street corners twirling signs. And so I moved over to Chicago. She’s like, you can come do this with me. And I’m like, all right. So we’re handing out, as you know, Chicago’s food festival. We’re handing out free packets of chili salsa and stuff like that. During the great food festival, we’re having signs like, come visit this on a street corner. And I’m doing it with my sister, so it’s making me laugh because she’s about to graduate from University of Chicago Medical School a few months ago. I’m worth $5 million or more, right?
And it’s all gone. Right? And then I used to drive a new Range Rover and everything back then, and every Range Rover that drove by, and my sister, I was like, you’re one bad decision away. It’s like, it’s coming for you, too. So I was probably one advertising, but then also just this doom apocalypse creature on the corner. And then eventually my sister graduates, and she’s got to go on with her life and everything. So I ended up moving in with my mother in California. And I was just lucky at that time that she had an extra room and was willing to provide housing and food. So I would live very cheaply for years and years. And part of that was it comes out to then what am I actually going to do?
And with insatiable curiosity, and I know this is what we were kind of getting at earlier about portfolios, it’s extremely personal to us. It’s praxis, right? This is my entire life philosophy that I’m putting into this business and this portfolio for you. So it’s deeply personal. And so to me, it was more of that alignment where maybe in my younger years and maybe living under what’s important to others or some sort of Girardian mimesis, where it got to the point of, this aligns with my values and who I am at this point, and this is deep practice for me. So this is all I want to do. If it works, if it doesn’t. But this is what I want to do.
I always, I joke with our mutual friend Senra about there’s that quote was like, what would you do if you knew you couldn’t fail? And I’m like, fuck that quote. It’s like to me it’s, what would you do if you knew you would fail? That’s what we’re compelled to do.
Jim O’Shaughnessy
That’s a much better question.
Jason Buck
Just run headfirst into walls every single day knowing failure is probably imminent.
Jim O’Shaughnessy
Yes.
Jason Buck
And if we do get lucky, great. But otherwise, that’s what it’s—not anybody would do anything. Yeah. What would you do if you couldn’t fail? Anything. I’d fly out this window.
Jim O’Shaughnessy
Right, exactly.
Jason Buck
But no, we’re compelled to do things. And this gets back to where you and I disagree about free will. It’s like I’m compelled to do this thing where it’s high likelihood of failure, but I don’t know anything else better to do because it’s just everything of who I am and this amalgamation of detritus I’ve collected from others throughout these years because I don’t even have any thoughts I can call my own. They’re really other people. I guess they’ve been uniquely put together into this body and brain. But that’s all I’m doing, is using those to the fullest extent of my abilities. I’m just giving my all into this. And if it works, if it doesn’t. Because we can’t help ourselves.
Jim O’Shaughnessy
So I don’t know that we disagree on free will. I think that we have different shading on free will. I think that I’m not going to be so arrogant to determine that this tiny little human brain of mine is going to be able to conclude with 100% certainty and no ability to falsify that free will does not exist. Right. And so I make a choice and my choice is I’m going to act as if I have free will.
Jason Buck
Yes.
Jim O’Shaughnessy
Because again, I’m huge into evidence. Right. And like we were talking about it with the religions that the end is nigh and no end. No end. And yet we still get more members.
Jason Buck
Put the Nikes back on. Mix up the Kool-Aid. Let’s do it.
Jim O’Shaughnessy
Exactly What were they? Tee and Dough? I can’t remember their names. One of my guys, one of my principal salesmen had that guy’s picture, that cult member. I can’t remember his name. This was the Hale-Bopp comet one and he had the guy’s picture on his board next to us. And I’m like, Chris, why do you have that? He goes, that is the world’s greatest salesman.
Jason Buck
Yeah, exactly. We pale in comparison to that. That’s our aspirational qualities.
Jim O’Shaughnessy
But so on free will, I have—I’m not smart enough to be able to determine whether that ultimately. But I also share many of your ideas about this cloud of ideas, like Rupert Sheldrake. I don’t know if you’re familiar with Rupert’s work, but I’m fascinated by it because he posits that there is a, for lack of a better term to define it, a cloud of human knowledge that we all can interface with. Very brilliant guys like Tesla, Nikola Tesla, believe this. Have you ever read his really short autobiography? I’ll give you a copy. I think you’d really enjoy it because he’s very straightforward. These aren’t my ideas that I get them. They appear in my mind and I’m basically just a copy guy copying them down.
And that got me into a mode which I’m in now and have been in since I discovered this was very helpful, which is I am at best a co-creator. At best, right? To say, no, this is mine. I did this. No one else could have done this. You’re just feeding your own ego and that leads to bad stuff. When you realize, no, no, co-creator, it actually, guess what happens? You get a lot more creative because all of those ideas that, oh, those aren’t mine. Not invented here. I can’t think that way. You let them in and you’re like, huh, this actually is a really great idea. What if I tried it this way? That way.
Jason Buck
Do you feel like you don’t have writer’s block then, right? Because you’re not so stressed out about being the progenitor of these. To your point, I’m not sure if we’re the receptor or the progenitor. And to clarify, I think we are very closely aligned on it. We can know with pretty high probabilities that maybe free will doesn’t exist from everything we experience. But then at the same time, like you said, it’s like for me to be able to put on clothes and use a toilet, I have to believe in free will, right? But that’s the rub. I always think about it. That’s the paradox and the contradiction that we’re always going to live in, right? And that’s why when either you have a materialist or an idealist. It’s like yes and. It’s both.
Or the new mysterians or I think that our subconscious or our thinking apparatus is not the thing we need to actually discover the unconscious or any sort of cognition. Right. So we’re always at this paradox of we’re screwed. You’re never ever going to figure this out and that’s what you’re saying. The people that are super confident in it, that makes me even a weirder religion or a faith-based thing. But I’m curious, I’m really interested in—I think I’ve heard you say you’re agnostic before. Right? That’s fair. I always like the logical positivists for their deficiency even though they got a lot of things wrong. But what they talked about, agnostic. Right. It’s like until you can say anything, a coherent sentence about God, then there’s nothing to talk about. Which is kind of—right. If God is everywhere and everything, we don’t have any separation to understand. Right, I get it. But as soon as you use the word atheist or agnostic, you’re defining yourself by God and I find that very interesting. Right. You’re anti these things or on the fence about these things.
Jim O’Shaughnessy
But are you defining yourself by God or by society?
Jason Buck
That’s fair.
Jim O’Shaughnessy
I think, I think that because religion, when you study history, you go back to Jericho. Vengeful gods show up when populations grow above a certain amount. Right. And that is a vengeful God showing up. That’s society saying, God damn it, we’ve got all these problems over here. Wouldn’t it be great if there was some vengeful all-seeing deity who could tell them—that’s by the way, that’s another religion is the best marketing ever.
Jason Buck
Of course.
Jim O’Shaughnessy
It’s amazing.
Jason Buck
I’m trying to build a cult. I’m a cult leader. Exactly. I’m trying to get people to drink my Kool-Aid.
Jim O’Shaughnessy
Exactly. Because the beauty of it is you could be wrong, wrong, wrong. And it doesn’t matter because it’s still going to happen someday. And let’s throw in, but wait, there’s more. You get to be one of the people who gets raptured if you believe, if you don’t believe, you’re going to the other place. And so I’m fascinated by religion and more importantly the effects that it has had on every human society since the beginning of time. We talked about this at my house. How Babylonia took over Mesopotamia is so brilliant to me. They were like, hey, we’re the coolest city-state. We should rule all of Mesopotamia. But we got a problem. Our God is puny. Marduk is like this. It’s like an afterthought in the pantheon of the gods. And the priests are like, no problem, we’ll do a rewrite.
And so they literally rewrote the myth of their God to make the God the greatest God of all time. He fought this mythical creature and tore it in half and threw half of it up, which created the stars and heavens, and threw the other half down, creating the Earth. And suddenly—and he absorbed 50 other gods. Right. And suddenly everyone was like, we like that guy.
Jason Buck
That’s a badass Marvel Universe God. I want that one.
Jim O’Shaughnessy
Yeah, I want that one. But it works.
Jason Buck
It works unbelievably well. And that’s what I was getting at. What I find really interesting. I assume you’re raised Catholic, right?
Jim O’Shaughnessy
Catholic light.
Jason Buck
Catholic light, yeah. Which I think that’s most Catholics, right?
Jim O’Shaughnessy
Not if you talk to my wife.
Jason Buck
Well, yeah, I should say my grandparents one side, they went to Latin mass, as you remember, back in the day. So I guess they weren’t light. But my mom was Catholic light.
Jim O’Shaughnessy
I was on that edge. I wasn’t around for the Latin masses because of Vatican II.
Jason Buck
Yeah.
Jim O’Shaughnessy
But I did know—I was an altar boy. And I did know all the smart-ass—me a cowboy, me a cowboy, me a Mexican cowboy. For mea culpa, mea culpa, mea maxima culpa.
Jason Buck
Oh, my God, I’ve never heard that one before. That’s so good.
Jim O’Shaughnessy
And then there’s another one. Kyrie Christe, Kyrie Christe. That changes to carry carda, carry carda, carry credit carda.
Jason Buck
Oh, my gosh. But also, you remind me—actually, it popped in my head. I couldn’t remember for a second. Pascal’s wager. Right. The problem with Pascal’s wager is, which God? Right? So you know that one, but also—and then what also threw me off, mea maxima culpa. Did you see that documentary about the priests at the deaf school? I think it was in Minnesota. So it was your former neck of the woods.
Jim O’Shaughnessy
Yeah.
Jason Buck
It’s horrible. It’s horrific.
Jim O’Shaughnessy
I haven’t seen it.
Jason Buck
But basically the priests were molesting kids that—parents didn’t speak sign language, so they picked those kids. Right. But there’s also some interesting things that came out of this documentary. Not necessarily positively. But one of the things was they had this therapist that worked with pastors, whether they’re drug addicts or alcoholics or whatever. And he’s like, I can rehab all of them except for the pedophiles. So he’s like, the only solution I can come up with is we need to—we have this—we own this island in the Caribbean. Let’s build a monastery there and let’s put them there instead of transferring them around to different parishes. And of course, that was the only solution he could come up with. And at the time they’re building it, it came out in the news.
Jim O’Shaughnessy
Sorry, did Epstein buy this?
Jason Buck
But it came out in the news and they’re like, wait, they’re building a Club Med for pedophilic priests? And so it all got shut down, but it was the only solution they had.
Jim O’Shaughnessy
There’s so—by the way, there is so much of that. There is so much of solutions that actually make sense. Let’s put them all on an island that’s really hard to get to, call it a monastery. Keep them all in one place. We have these other things called fed max high-security prisons.
Jason Buck
Right.
Jim O’Shaughnessy
Nobody gets upset about those.
Jason Buck
But it’s like that’s—it’s actually—do you know that the monasteries actually came out, the Epicurean communes. So it already was coming along that line in that sense. But then I also—because my brain’s broken, in a way, I feel a little bit bad for the pedophilic priests, in a way. Stay with me. Just because I was luckily born with heteronormative beliefs. And so I can’t believe that if my sexual nature was turned on by that and I couldn’t control it. And that’s actually what that therapist was saying. These priests were pretty much like, please lock me away. I can’t deal with my nature wanting to do this. I can’t stop myself. So please lock me away. So they were dealing with—sorry, we full circle.
But I want to come back to Catholicism because I think it’s so interesting and I really wanted your take on this. I have found that anybody that was raised in Catholicism, it’s by far the best at getting all of your senses involved, right? From stained glass windows to beautiful art to music to the incense, it’s hitting all of your senses at such a young, formative age that I find Catholics, even when they say they’re agnostic or atheist, they never truly escape them because it got so locked in at the formative years of their life. Does that make sense?
Jim O’Shaughnessy
It makes a ton of sense. And I have studied the Catholic Church deeply, but for different reasons. The Catholic Church is the world’s most successful cult. And I don’t mean that as a way to disparage them. They really knew how to grow religion. Right. So St. Paul, Saul falls, hits his head, sees the light. But if you look at the way he marketed Christianity, because it wasn’t a Catholic church at that time, it was absolutely brilliant. I mean, literally, he developed a mesh network of synagogues where he would go because he knew at that synagogue were the most important people in that town. They were going to be the connectors with everyone else. But the genius of it was Judaism remains small because it has so many really difficult to adhere to rules. Right.
You got the eating and the dressing and you can’t touch anything during this. And St. Paul is like, with this religion, you don’t have to do any of that stuff.
Jason Buck
But you think they had to do that because on Silk Road, because they’re money changers and lenders, you had to have that trick so you know he could trust. But then they… just come in ...
Jim O’Shaughnessy
Just come in man.. You know what’s great about our faith is there’s only one actual God. It doesn’t matter what gods you were brought up with, back to Mesopotamia, it doesn’t matter what your current faith. It doesn’t matter what color you are, what sex you are. Everyone can be a Christian. It was the original big tent approach to converting people and they made it extra easy to convert. And then they added just brilliant things like you’re referring to, the Catholic experience. Mine was more suburban, so we didn’t get the incense very much.
Jason Buck
You had smelly pilgrims coming into the church that you had to make up.
Jim O’Shaughnessy
Right. But you’re right, I mean, I can still recite many of the Catholic prayers just from memory. As it was in the beginning is now and ever and forever shall be world without end. Think about that for a minute. As it was in the beginning. We have defined the entire past for you. You don’t have any more questions about that. Is now. So we’re doing it for you now. And forever shall be. We got you. Yeah, shrink-wrapped. We got you, baby. For every part of your life. And then the way the ceremonies are, life events, baptism, confirmation, marriage, last rites, they’ve got it all. It’s just genius. It is genius the way they do it. But the thing that they did better than any other religion, confession.
Jason Buck
100%. I couldn’t agree more with this.
Jim O’Shaughnessy
The greatest and smartest marketer in the world would never come up with that. And yet, are you kidding me? I get to lead a horrible and dissolute life and all I got to do is go in. Bless me Father, for I have sinned. It has been, you know, 30 years since my last confession. But I’m feeling really conflicted and bad about these sins. I absolve you. Boom, they re-virginize you.
Jason Buck
This is probably what actually made me explore religions was watching all of my relatives that were Catholics sin all week and then on the weekend be like starting over. And I was like, this can’t be right.
Jim O’Shaughnessy
This just can’t be right. So, but brilliant.
Jason Buck
Yeah, 100%. But do you think as times change in modern times, there’s over 30,000 sects of Christianity in America alone, but I would even argue there’s over a billion because essentially everybody chooses their own religion. Right. There’s pieces and parts of the Bible or their past that they take and don’t take. And we choose and we pick and choose. And so when we’re trying to talk about these ideas, this is actually—you and I think about this a lot. It’s like by simplifying ideas we’re losing all the nuance and complexity. And actually individuals have their own religion and they may when they’re together in a congregation, it might sound like they want that community, but they’re really not Christian or Catholic based on all the doctrines. It’s pick and choose kind of your own religion and your own adventure along the way.
Jim O’Shaughnessy
Yeah, à la carte.
Jason Buck
Yeah. But we’re all individual in that sense.
Jim O’Shaughnessy
Yeah, I agree. And I should also, I am not anti-religious people.
Jason Buck
Yeah, it’s great community thing.
Jim O’Shaughnessy
Yeah, it’s amazing for community. I mean you really do have to take seriously the Mormons for example. Look at again evidence, is there evidence that being a Mormon, not one of the ones in the crazy multi-wife tribes, but just a traditional Mormon leads to really good outcomes for the most part in terms of health, in terms of productivity, in terms of all of those things that are genuinely good for society. And so it’s just—I have no animosity other than for fundamentalist kind of religions where again certainty. I think one of my greatest things is certainty is absurd. And if you are—and of course, the hitch in our human OS is who are we drawn to pick for our leaders? The people who seem absolutely the most certain.
Jason Buck
Confidence.
Jim O’Shaughnessy
And so it’s just this endless wheel, like a hamster wheel, that we’re just like, well, that other guy didn’t work out, but this guy seems even more certain.
Jason Buck
Yeah, there’s nobody more annoying than a militant atheist.
Jim O’Shaughnessy
Right?
Jason Buck
Right.
Jim O’Shaughnessy
Oh, right.
Jason Buck
The most annoying.
Jim O’Shaughnessy
Talk about the truest of true believers.
Jason Buck
Exactly. It’s just like, yeah, it’s like when I guess goth kids think they’re different from everybody else. It’s like, no, you’re just running in the goth herd next to the herd, but you’re running off a cliff like everybody else. It’s the same thing atheists are. The militant atheist is like, I’m different. Like, no, you’re not. You’re still the same. Right. But I wonder, like you said, there’s beautiful things about community with religion and beautiful things about tradition. But I also wonder, I don’t know if you’re like me when you read about all this stuff about longevity, community, all of these things, I just assume we’re going to die young because if we’re just these really insular, just going our own way, why are we—we’re fighting these headwinds all the time.
So I assume that’s just taking years off our lives or because everything we read about longevity, we do the opposite of.
Jim O’Shaughnessy
Well, I got my fingers crossed. I’ve got lots of longevity in the genetic heritage.
Jason Buck
So do I.
Jim O’Shaughnessy
I got that going for me, which is nice. I think that’s another aspect that I really like about true market aficionados. Generally, they’re a lot like you. And by that I mean they love to know about everything. Because I always thought of Wall Street as kind of the Olympics of business. Right. We had a family business that my family did very well in, my extended family, which was the oil business. And my uncle kept trying to get me to go, and I’m just like, Uncle John, I have zero interest. I mean, I think you’ve—it’s amazing what you’ve accomplished, but oil.
Jason Buck
Yeah.
Jim O’Shaughnessy
And that’s it. And I’m sure I would look ridiculous in one of those big hats.
Jason Buck
All hat, no cattle.
Jim O’Shaughnessy
Exactly. All hat, no cattle. But I definitely think there’s a personality type that is drawn to do what you do and what I did. And it’s an interesting one that I always try to find the ur-pattern of.
Jason Buck
What’s ur-pattern mean?
Jim O’Shaughnessy
Ur is the kind of the primitive primordial pattern of which other patterns are built. So it’s the primitive—if you’re doing AI, the models they refer to as the base model is—they call a primitive of that type of personality. Because I have a good friend who’s very smart. He’s a doctor here in Manhattan. And when he was here last time, he was like, Jim, would you shut the fuck up about telling everyone they should think probabilistically. He goes, because that’s a prescription for disaster.
Jason Buck
Yeah, well, as you know, he’s a mutual friend of ours and he’s 100% right. Because part of it too is a lot of people in our position want everybody else to be entrepreneurs or think the way we do. I don’t want anybody to think the way I do. And I actually think entrepreneur is a bug, not a feature. I think it’s terrible brain chemistry. Right. The way society’s set up for bimonthly paychecks, a salary, and then you get a mortgage and it all makes sense. Right. It’s bond-like income. Why do we want this equity VC-like income? There’s something wrong with us. And just I know to you and me, Hypomanic Edge was a really important book to me in my 20s.
Jim O’Shaughnessy
Yes.
Jason Buck
It made me understand myself if I have this mild bipolar. Right. Because part of that bipolar is that you get all the positive effects of really being able to lock in and focus on things and build businesses where you’re creating an entire world that you’re the fuel for that. But it also comes with a commensurate downside as well. Right. The darkness.
Jim O’Shaughnessy
Yeah, well, everything does.
Jason Buck
Right, right. It’s just not a free lunch.
Jim O’Shaughnessy
No. And when I was in my 20s, I was just staring way too long into the abyss. And as you—you know the quote, it stared right back into me. And I was like—for a while, I was just like, why bother? Nothing matters. There is no truth with a capital T. There is no such thing as enlightenment. And the way I came to kind of figure that out because that leads to nihilism. And my thought was, well, okay, let’s assume that this is mostly right, even though I think it might be mostly wrong. Let’s just assume it’s mostly right. Well, what can I do about it? And I call it walking across the bridge of nihilism.
And when you get to the other side, you’re like, okay, well if life has no meaning and there is no such thing as enlightenment and there is no truth with a capital T, that means that I get to determine meaning. That means that I get to say what matters in my life. And so once I really embraced looking at the world that way, that’s when all of the dark abyss staring stuff didn’t end, but it was just like, oh, there’s the abyss again.
Jason Buck
Okay, this is why I love talking to you. Because it gives us time to talk about, pull on strings of nuance. And so you say you’re saying nihilism and everything. And I’ve always—everybody thinks nihilism is a pejorative.
Jim O’Shaughnessy
Right.
Jason Buck
But I think what got to the point, what you said is the true, I guess, definition for nihilism is there’s no grand meaning to life. Right. But like you just said, that means we get to make up our own quotidian meanings to life.
Jim O’Shaughnessy
Exactly.
Jason Buck
So our family, our friends, whatever we’re into, drinking or eating or whatever and just sitting in the park, having an espresso, that’s the meaning of life. Having conversations like this, that’s my favorite part of life. And so that’s what I mean. So it’s like, don’t you think that’s fair? It’s like, so you can be a nihilist on a grander meaning, but that’s totally different from making individual meaning on a daily minute-to-minute basis. Right. Totally. So, okay, that’s—I just want to clarify that because I always—people are like, because I get accused of being a nihilist all the time. And I’m like, yes and no. I mean there’s nuance there. But also I was thinking about your—I forgot I didn’t answer your thing on ur-pattern for people like us.
I really wonder how much of it is just competitiveness in the sense that—because you come across as not competitive. But I know there’s a beast of competition inside you and these guys know it too. Sorry I broke the fourth wall.
Jim O’Shaughnessy
But I break the fourth... you know, we had a show that we financed through our Infinite Films.
Jason Buck
Yeah.
Jim O’Shaughnessy
On cheese.
Jason Buck
Nice.
Jim O’Shaughnessy
And he was here, he said he’s fabulous and he’s this really—talk about a charismatic guy. But they came on camera to test the cheese.
Jason Buck
Nice.
Jim O’Shaughnessy
And they were like, yeah… You didn’t mic yourselves, though.
Jason Buck
See.
Jim O’Shaughnessy
You screwed another one up, Danny.
Jason Buck
You had another—you had a Bourdain moment to bring in this. It’s just show your magnanimity. Let them eat cake as well. They can try the cheese. Just let me go first. But I wonder—so I think about competitiveness, when I was a soccer player, right, you want to compete at the highest level. Sure. That’s the way I always looked at it. But I had some friends that would go play on weekends with their friends that weren’t as good players and they’d dominate and that would make them feel good about themselves. I never understood that. It’s like, I want to play at the highest level even if I’m losing because—right, I can get better. And so I think that’s maybe what it comes down to is Wall Street, finance, investing is playing the game at the highest level.
Jim O’Shaughnessy
Yes.
Jason Buck
I mean, as a society, should we exalt that? Probably not. But it’s the highest remunerated business in the world, which means the highest amount of brain power comes into it. So it’s like, if you want to compete at something, this is the highest level to compete at. And it’s not necessarily about winning, but it’s about challenging yourself. Right. To me, it’s about self-growth and that self-challenge. And so maybe that’s, I guess the big part of it is competing at the high level. And then to your point, about conversations for both of us are our favorite things. And I thought this was the world I wanted to be in because I thought hedge fund managers are usually polymaths and have a lot of varied interests and they deep dive because they can’t help themselves either.
And so you can have much more interesting conversations a lot of times that way. So it was—for me, it was part of both. It was the competitiveness and then also trying to just have the best conversations possible.
Jim O’Shaughnessy
Yeah. And I think that you also have to realize that, you know what did Feynman—his great quote, don’t fool yourself, and you are the easiest person to fool. I fell into that. It was like the rake, man, you know? You a fan of the Simpsons?
Jason Buck
Yeah.
Jim O’Shaughnessy
You know, where the clown has all the rakes and he just steps from one to the other. I felt like that often.
Jason Buck
Do you resonate with the fool in tarot? We’re just stepping off the cliff, oblivious, just enjoying our lives. Well, the fool is a positive card to me. Not that I’m into tarot, but I’ve just always loved because also the number zero, which I thought you might like too, for the fool. But—
Jim O’Shaughnessy
Yes, yes. But I definitely think that it is just a very liberating thing if nothing else. I mean, we both agree there is no enlightenment. We’ve both read Jed McKenna and I think the best thing he does is, enlightenment is a booby prize, man. It’s just like if you ever get—why do you think Buddha just sat beneath that tree for the rest of his fucking life? Because it’s just like watching a screen with static on it. And he posits that the real prize is what he calls human adulthood, which is being alive in the—or being aware, awake in the dream state and realizing how many cool things there are that you can play with and do whatever with.
Jason Buck
But you’re so good. You’re so much better than I am. How do you deal with the hubris and self-aggrandizement that comes from that? From thinking you’re a human adult? Right? That’s the idea is you’re essentially, I guess—
Jim O’Shaughnessy
Oh, I don’t think I’m a human adult. I think I’m still in the—because—
Jason Buck
Because that’s my thing was there is no materialism and spiritualism. It’s all materialism.
Jim O’Shaughnessy
Right.
Jason Buck
And all the spirituality, all the levels of attainment you get from meditation and everything is just selling trinkets in the marketplace. So I’m wondering, it’s like a video game. So it’s like I can be a human adult as opposed to a childlike adult way. Hold on, how do I get that? Now I’m better than everybody else, but I get to play with the Matrix while they’re living in the Matrix. And that’s what I’m always fearful of is how do you fight against that self-aggrandizement that you get from any of those—yeah, trinkets that you collect along the way.
Jim O’Shaughnessy
Yeah, I think that’s a challenge. Again, we’re back to personality types, right? And I think what happens is—I was very competitive when I was younger and I was also a proselytizer. I shall tell you, I don’t know if you’re a T.S. Eliot fan, but The Love Song of J. Alfred Prufrock, he walks in and he’s like, I shall tell you all. I shall tell you all. And then Eliot has a woman saying, turning away with her shawl, that isn’t what I meant at all. And so I was a proselytizer because I really believed I spent years figuring this stuff out. And guys, there is tons of evidence here that all you need to do is pay attention to the evidence and then use it.
And it’s like the South Park, you know, startup, bro down, sell out, profit.
Jason Buck
Yeah.
Jim O’Shaughnessy
But I would and then I realized that as you said earlier and I subscribe to it 100%. There are hundreds of paths to success investing in life. Right. The key thing is you’ve got to find the one that is right for you. And what do I mean by right for you? You can stick with. Isn’t one where you’re going to be like—and you know, oh, I’m just going to abandon that whole thing now. I do not by that mean you can’t improve it. Of course you can improve it. That’s what we spent all of our time doing on models.
Jason Buck
Right.
Jim O’Shaughnessy
We have a huge graveyard. Had a huge graveyard at OSAM. But I think graveyards are important too. Right. I think again it’s another human instinct if you will, part of our OS to really shy away from learning things via negativa. Right. And you can learn so much from what didn’t work and just keep that there in mind. Now does that mean that it will forever not work? No, of course not. But it’s at least on your radar over here. And just the open—again, open-mindedness is another one that is a real high on the OCEAN profile, the Big Five of people like us. And yeah, weirdo.
Jason Buck
Have you ever taken the personality test but take them a day apart or whatever and you end up with a different personality moniker?
Jim O’Shaughnessy
I unfortunately have never done that.
Jason Buck
I’ve tried it because of our skepticism. I’m like this is awful.
Jim O’Shaughnessy
Yeah.
Jason Buck
Oh because there’s some of those questions where you’re hemming and hawing and you’re like—and so maybe on the next day you had a different breakfast so you go a different way and they’re gonna kind of—whatever. I can’t remember like the INTJ or you might be like an ENTJ. So it’s like an ENTJ. Whatever. Yeah.
Jim O’Shaughnessy
And I have been and by the way it’s kind of astrology. Yeah, it’s astrology. Right.
Jason Buck
And self-aggrandizing it because all the good characteristics. You’re like oh that’s me. Open-mindedness. I’m the most open-minded person on the planet.
Jim O’Shaughnessy
Absolutely the most open-minded. How dare you say that I’m not open-minded. Yeah. But I do think the Big Five is interesting because it does replicate, it does remain rather stable no matter when in your life you take it. And so we have our own installation for AI and one of the things we’re working with is A/B testing a variety of audiences for—because we have a book publisher, we have a movie company and it’s been really fun.
Jason Buck
So you’re creating psychographic profiles. Yes, in AI. But I’m sure you’ve seen like Century of the Self and like Edward Bernays. My favorite part is the hippies came and they’re like we’re all individuals. And they had seven cohorts of hippies. You’re the Subaru hippie. We’re going to sell you Subarus.
Jim O’Shaughnessy
And so it’s like Eddie Bernays. Yeah. That guy was a fucker beyond all imagining.
Jason Buck
Was it freedom sticks for the—freedom sticks for the women? I mean it’s brilliant.
Jim O’Shaughnessy
And not only—who I’m talking about for everyone listening is Edward Bernays who was the nephew of Sigmund Freud. Make of that what you will, but this is the guy who was like no, no, it’s not propaganda, it’s public relations. And people would go to this guy like the cigarette makers 100 years ago. Right. What’s so funny is I was literally thinking about this last night and you bring it up because…
Jason Buck
Wasn’t—it was one of these avenues, right? Where they had the protests, they got them, they gave them all free cigarettes.
Jim O’Shaughnessy
Yes. So he’s like, well we are mimetic creatures and they didn’t want women smoking in the 1920s was a no. Right. They didn’t do it. So what did he do? He got the most glamorous debutantes in their, you know, flapper era dress all smoking at the thing. And those are the only photographs that any of the photographers took. They showed up in every newspaper around first New York, but then the world. And it started the—I mean just to think about that. Think of how many deaths he caused from that one thing. But his greatest hits goes on and on. The United Fruit Company was very unhappy with an outcome of an election in Guatemala. And he’s like, I got you. But yeah, the—I highly recommend all of his Century of the Self and they’re all available. Adam Curtis, I think his name is.
Jason Buck
Yeah. It just shows we’re once again lack of free will or we’re so susceptible to things way more than we realize, and we fall into cohorts especially. That’s what I find for you and I, we feel we’re so individual and nobody’s like us. But then they can nail you into a cohort pretty quickly. Right? But you’re like, but there’s less people in this cohort, so therefore I’m kind of special. But you said you were thinking about that the other night. I was actually thinking about the train right here. I have a great question for you, I think, is that I was thinking about with the fellowships and everything you’re doing, right? And I think about the history of trying to get people together, whether it’s Tuxedo Park, Bell Labs, Santa Fe Institute.
So my guess is you’re almost trying to create a virtual Santa Fe Institute, kind of what you’re doing, your fellowship a little bit. But I remember what dawned on me, though, on the train ride here was I remember a student years ago was telling me he was taking a class on dystopias. I was like, I go—just popped into my head. I was like, you know, what creates dystopias? And he’s like, what? I go, utopias, of course. Right. We would never have dystopias without somebody having a utopian ideal, right.
Jim O’Shaughnessy
Exactly.
Jason Buck
But when we’re trying to create these fellowships and you’re trying to create the people around you to keep you engaged and everything, I’ve always been studying that as well, how do you create that utopia without it becoming dystopia? One bad apple. Right. Can ruin the whole thing. So I’m sure you’ve thought about way more than I have. So that’s—I was really curious, your take on that, because how do you create these great communities where people can really come together with divergent opinions and you find something better through that. But it’s very—it’s a delicate structure to maintain.
Jim O’Shaughnessy
It definitely is. But that kind of gets to mesh networks versus command and control networks, right? A mesh network. That’s the Rothschilds. Why were the Rothschilds rich? They weren’t rich because they had all the gold. They were rich because they had brothers living in different cities, right? Very key. Because different culture in that city, different intelligence, different things that you’re going to know about. And they had a world-class, both spy and communication network with pigeons. Right. And so they had a distributed network, which we call a mesh network. Right? And the Republic of Letters, same thing. Raphael, his studio was a mesh network. People don’t think about that, but Raphael had one guy who did perfect hands, one guy who did perfect eyes and nose, one guy and so on down the thing, and he would literally let those guys do it, and then he’d come check it out, and he’d add his touch. But the reason mesh networks work so well is because they are decentralized and they are not subject to a central authority. Right. So the Republic of Letters is where for hundreds of years, people like Voltaire, Frederick the Great, Catherine the Great interacted through letters with natural philosophers, which became what we call scientists. Right. And the way it worked was just purely organic.
You got a—I got a letter from you, and I’m like, wow, Jason makes a really great point here. I annotate it and I put my opinion, and then I forward it to another friend. And then the value extractors come in and grab that network. What grabbed the Republic of Letters? The Royal Society, because they were all members of that. And then the minute you centralize it, what happens? You start getting orthodoxies, you start getting dystopias. Right. And I’m not saying that the Royal Society created a dystopia.
Jason Buck
Like we talked about, it was like, if Buddha came back and saw Buddhism, what are you guys doing?
Jim O’Shaughnessy
What is going on here?
Jason Buck
But did you think, for example, Bell Labs, it wasn’t centralizing, truly, in the fact it was just centralized funding coming from Bell Labs, and they let them kind of do whatever they wanted.
Jim O’Shaughnessy
We’re making a documentary about it, and we’re using the book and working with the author. The book is called The Idea Factory, and Bell Labs is a perfect example because you’re right, the funding was coming in, but the way they ran it was very decentralized. I mean, you had Claude Shannon inventing trumpets that spit fire and a chess machine.
Jason Buck
Wasn’t the—The original one was in West Village before it went to New Jersey? Right, yeah. So how much of that is zeitgeist dependent? Right? Because wasn’t Claude Shannon and the others, they were staying up late at night to watch jazz in the Village, and it was just coming online right there to have the coffee shops and the kind of the bohemian lifestyle.
Jason Buck
The same way, back to mesh networks. That’s another great example. The way insurance emerged. It emerged when coffee shops got popular, right? And everyone’s wired on coffee, and suddenly we have an industrial revolution. But the reason it worked for insuring ships was distributed knowledge. Right. If you have uncorrelated priors among people who have some reasonable level of experience in that particular thing, beautiful things can happen and that’s how they ended up. Right. That’s created Lloyd’s of London. And so I think that to your point, we are—we would never be so prescriptive that we have any kind of utopian agenda and, or basically we have a very simple agenda which is we now can find and identify some of the most unconsensus intelligence out there and we can fund them. And so I kind of felt a moral responsibility to do that. Right.
If you look at all of human history, a genius could be born, live and die. And no one, including the person knew that they had any special talents at all. Because we’ve gone from a very—I mean think about the fact that your average human to ever live probably didn’t wander too much outside of—unless you were the earliest humans and hunter-gatherer. If you got around when we had villages and towns, you maybe walked five or 10 miles and that was it. Right. And so we are—I kind of believe that with all of the interconnectedness and all that, yeah, sure there are problems, but it also, there’s an emerging intelligence from that and I think that’s hard to deny and you could take advantage of that.
And I think that one of the keys there is that it be diverse intelligence. Right. And again, like you said, you can only learn by screwing things up yourself. I learned this by watching it happen. We have annual gatherings where all the fellows come and all the OSVers are there and watching the marketing guy talking to the pure science geek and having both of them come to me and say that was the most amazing conversation I’ve ever had in my life. Because the marketing guy got to learn about the, all of the things that he thought he knew because he was a, you know, self-quant type guy. The quantification of self. And I don’t, interestingly, I don’t do any of that. Yeah, I have real watches. I don’t have Apple watches.
Jason Buck
So analog and cool. You’re like the kids these days, you’re going back to cameras.
Jim O’Shaughnessy
But the point is each learned from each other because they were just both fascinated on figuring out how do we solve your problem. And her problem, the science geek, was that she was thinking about her invention, which is really interesting, in the completely the wrong way. And her marketing would have failed and nobody would have used it. And then our brilliant marketing fellow was like, oh, no, here’s the way you got to do that. So we don’t have really grand ambitions.
Jason Buck
That’s the best part about Santa Fe Institute was the cross-discipline nature, like interacting. And then the early days of Bell Labs. Right. Whether it was when Claude Shannon interacting with John Kelly or whatever, it just led to much more interesting things that way. And it’s just, how do you create those collisions? Because similarly, I was thinking about what is it Habermas has, communicative rationalism where it’s like, through dialogue. And that process is where we can get to better ideas. I always—I joked with you at your house. It’s like, I always love that writers think that writing’s the best way to think. Right. But I like dialogue. Iron sharpens iron. Right.
You might be able to sit in your room and write and then spend months editing, and then you bestow it upon me. But I can’t really argue against it. You’ve been working on this thing for months. Right. It’s a monologue, but in dialogue. Hopefully we can get there in two hours that took you two months to get to. But the hard part that they found out the hard way, let’s say, at Bridgewater, for example, is that part of that communicative process is everybody’s got to kind of be on equal footing and there’s no dictator. There’s nobody bullying the other people at the table. And I think given human nature, that’s the hardest part. Right. Is to make people feel comfortable in speaking up.
Jim O’Shaughnessy
And again, touché.
Jason Buck
I don’t know how you do it. That’s what I’m asking.
Jim O’Shaughnessy
Well, again, that gets to what is the real hierarchy of needs for the human. And I definitely think that prestige and status sit at the top of that. I think they—or bottom, I guess, they drive so much of everything we do.
Jason Buck
Oh, does the fellowship already give you that even playing field? Because you got the prestige and status of the fellowship. So then maybe that’s what lowers everybody.
Jim O’Shaughnessy
Everybody is…
Jason Buck
That’s interesting. On the entry point.
Jim O’Shaughnessy
Yep.
Jason Buck
If you got in this room, you have prestige and status. So we’re all equal.
Jim O’Shaughnessy
Exactly. And so we’re definitely finding that is something. And in fact, one thing that we’re going to do is we used to distinguish between fellowships and grants. Grants are smaller. They were fixed at 10,000. Fellowships were rarer and fixed at 100,000 for a year. Now they’re all going to be fellowships, and the grants aren’t going to be fixed because one of the things that my team convinced me of was, you know, there are some grants that 10,000 really ain’t going to move the needle, but they need 25. Right. And so one of my colleagues who is also here was polling everyone, and he’s like, let’s just call everything fellowships. And so we think that it’s going to serve that need even better. So I’m very interested to see that you picked up on that immediately.
Jason Buck
So, yeah, it’s like, you’re all a MacArthur genius. You’re all an O’Shaughnessy genius. We’re all—okay. This is a safe space.
Jim O’Shaughnessy
Exactly. Yeah, it’s a safe space. And you can do—and look, I just think Tim Urban wrote the great book on this that I wish more people would have read. And it’s like we get put into these just confirmation bias bubbles. And literally it’s gotten to the point where you could have two people in the same building. Right. And my neighbor lives right next door to me. And the way we—we actually happen to get along fine. So this is a bad example, but he and I might have completely different filters. Right. On the way we view the world. I’m a huge believer that the lens you look through determines your experience. And by that, I mean the angry man lives in an angry world, the sad man lives in a sad world, the happy man lives in a happy world. And that people don’t understand that kind of freaks me out.
Jason Buck
But then you’re saying I’m doomed to curmudgeon pessimism, right? This is my—this is my lot.
Jim O’Shaughnessy
There is no hope for you, Jason.
Jason Buck
At least I find some—some humor in it, I guess, right? It’s like gallows humor. But I actually think about the lens is actually right behind you, like that beautiful Vik Muniz piece. I assume that’s what is. Right. He saw food and saw art in poverty. His story is the most incredible.
Jim O’Shaughnessy
I had him on. He sat right where you are sitting.
Jason Buck
He’s always fascinated. Because I lived in Brazil for a while, and he always fascinated me, what he’s able to do.
Jim O’Shaughnessy
I love his work.
Jason Buck
Just when you think every form of art has been done, they come up with a new one. How is that possible? Those are real creative people. We’re fake creative.
Jim O’Shaughnessy
That’s right. They’re true creatives. Well, and that’s the thing. There’s just so much that we—I’m a huge fan of David Deutsch. Because I think he’s right. We are literally at the beginning. What did Edison say? We don’t know one-tenth of 1% about nothing. And we get this idea that, oh, we are the modern ones. We are the ones who know about—all right. They thought the same thing.
Jason Buck
You bring up Semmelweis all the time, right? My sister’s a urogynecological surgeon. Got that out properly.
Jim O’Shaughnessy
Wow, impressive.
Jason Buck
And I always say, how do you not know? She does a lot of hysterectomies. I go, in the future, you might be known as the Butcher of Miami. This is what it’s like to have me as a brother. And she’s like, what are you talking about? And I’m like, 100 years from now, we might think hysterectomies were the most brutish thing we ever came up with.
Jim O’Shaughnessy
Totally.
Jason Buck
But like you said, we act like we’re at the frontiers of knowledge and we’ve got everything figured out.
Jim O’Shaughnessy
And we don’t. And the more you really internalize that. Right. It’s like when I’m always riffing on—on deterministic beings living in a probabilistic universe. Tragedy or comedy. Hilarity, result.
Jason Buck
Hilarity. Hopefully that. Or at least that’s the lens I want to see it.
Jim O’Shaughnessy
Yeah. Right. And again, that’s generally the two results. And it just amazes me that we return to our base rate, our set rate for—there’s so much evidence that certain ways of doing things really don’t work.
Jason Buck
But this maybe goes back to what we’re talking. I’m curious how you think about this. Because I know you’re a fan of normally Bayes and everything like that, but I have a—my general life philosophy is—it’s ironic being on Infinite Loops because my—I thought once again, you were stealing it from me before I got there is my life philosophy is open loops. So everything we know as human beings is a closed loop.
Jim O’Shaughnessy
Closed loop.
Jason Buck
Right. But there’s always permeability around the edges. Right. And we live in this open loop world. And the closest—some of the closest things I found to that was there was a statistician called Savage. I think it was Jimmy Savage in the ‘50s.
Jason Buck
Yeah. Yeah.
Jason Buck
Leonard. He’s known as Jimmy Savage, but he talked about small world and big world problems, or small world and larger world problems. And he said small world problems. And this is—I think it applies to AI interestingly too, that I always point out is if you have chess, Go, Jeopardy. Those are closed systems. They’re a known system with known probabilities and statistics to it. That’s a small world problem. And in a small world closed loop problem you can apply probability, statistics and even Bayesian theory too. But as soon as you get into large world problem, you need rough heuristics because you have no idea. I guess Taleb got close with Extremistan would be large world problems. So that’s the separation I see. So in a way it’s another contradictive dichotomy is we’re trying to solve a problem, right?
We know it’s a large world problem that we can never know the answer. But we use small world solutions in narrow fields to try to stack them up to hopefully do our best in a large world problem. Does that make sense the way I—this is the thing that bothers me every day probably.
Jim O’Shaughnessy
And you are absolutely right about the closed loop problem and trying by transitive property. Well, we can use that for all of these large world problems. Actually we can’t.
Jason Buck
Right.
Jim O’Shaughnessy
And that’s why I don’t yearn for a theory of everything.
Jason Buck
Oh, neither do I.
Jim O’Shaughnessy
It’s like when I read because I, and I read these guys, right? Because I’m interested in what they have to say.
Jason Buck
That’s the height of hubris, right. I’m going to solve everything with one theory. How insane is that?
Jim O’Shaughnessy
Crazy. Yeah, it’s just like yeah, probably not, you’re probably not going to do that.
Jason Buck
But on the flip side though, don’t you think the mental models of having 30, 50, 100 mental models and all this stuff is—that’s actually not helping you either. It’s actually because interesting. We would like to have childlike mind and go back to the beginning, but you’re going to shorthand things through mental models and therefore the map is not the territory. And actually mental models can be more of a handicap than a—they can be more a hindrance than a help.
Jim O’Shaughnessy
That’s interesting.
Jason Buck
So I just, I knew you’d like that because I knew that would get you because it’s a—that, you know—
Jim O’Shaughnessy
I knew that just destroyed my 50—I guess I started working on this at about 15, so my 50 years—
Jason Buck
Of mental models.
Jim O’Shaughnessy
Of mental models.
Jason Buck
But you know what I’m saying, now you just have shorthands. I hit the power button. Jim’s done. But this gives you joy too is pulling on that thread, if we pull long enough.
Jim O’Shaughnessy
Your name is Jason. Right.
Jason Buck
We hopefully pull on that thread, unravels the whole sweater. Right? That’s the point.
Jim O’Shaughnessy
Yeah.
Jason Buck
And I know you get—see, I knew you’d get it right away, too. It’s like, oh, shit. I shorthand these things into mental models so I don’t have to think about them again. And I automatically put things in these boxes where it may not fit that box.
Jim O’Shaughnessy
Which is my…
Jason Buck
Conservation of energy…
Jim O’Shaughnessy
My revolt against labels. Right. Labels do exactly the same thing. And what do we love to do? We love to label everything, because putting it in that label box, we don’t have to think about it anymore or we don’t—
Jason Buck
Right.
Jim O’Shaughnessy
Whereas we should.
Jason Buck
Is it a conservation of energy principle. Do we have the ability to fight that entropy every day of not putting in those boxes? Because we’re going through such a complex world?
Jim O’Shaughnessy
Yeah… that is a great point. And I don’t know the answer. I have no idea whether we have the energy to do that. I think you’re probably right. I think that the—look, George Box famously said, all models are wrong, some are useful. Right. So again, I cling to that evidence. Right.
Jason Buck
Your VAR model just needs GARCH to attach to it, you know, and then—
Jim O’Shaughnessy
And I winsorize it a little.
Jason Buck
Eventually you’ll get there.
Jim O’Shaughnessy
Cherry-pick. Hindsight bias. And then I’ve—You. You don’t understand. I’ve never made a mistake ever, in my entire life.
Jason Buck
Mistakes were made, but not by me.
Jim O’Shaughnessy
And, you know, I—that was one of my most popular pieces that I wrote, which was Mistakes Were Made, and Yes, by Me.
Jason Buck
Nice.
Jim O’Shaughnessy
Because that seems to be another thing, another reason I really love talking to you is I talked to so many smart and interesting people who just have this aversion to ever saying I was wrong or I don’t know. Yeah. Pomp had me on his podcast when he was still Mr. Crypto, and he said the thing that he loved best about it was half of my answers. He goes, we counted them. Half of my answers were, I don’t know. Yeah, I don’t know.
Jason Buck
That’s what I’m just creatively trying. Like you said, we started with, you evaded my question. I’m like, I’m gonna evade all of them. Because the whole setup here is for you to ask a question and me to provide answer.
Jim O’Shaughnessy
Yes.
Jason Buck
With every answer, I want to be like, I don’t know. Right. And that’s why I always tell you it’s my favorite at all of these finance or macro events, everybody wants to talk about the future. And my first question is, I don’t know the answer.
Jim O’Shaughnessy
And by the way, that’s another thing that—I love AI. I think it, but I think of AI as a tool that leverages my ability to do things much better than I could do them alone. But and so I loved it when it was called machine learning. I loved it when I wrote at age 22 a 20-page thing in my journal about the computer I wanted. I called it a supercomputer back then, but it was literally AI. I reread it, but I was talking to a guy who is one of our O’Shaughnessy partners, OSAM partners, who do research using all of our data. And he had—he’d retired very early from one of the big tech companies, bored out of his mind and wanted to do some research. And he was an expert in machine learning.
And I’m so, I’m like, so I think this is amazing, but why are people resistant? And he goes, I can tell you exactly why. He goes, because we don’t answer that question. We don’t answer the question why. We can tell you this. This pattern is showing up repeatedly. It leads to these patterns and these outcomes, this percentage of the time and to these very different outcomes, this percentage of the time. And the first question you’re going to have is why? And the model is going to go, no idea. Move on.
Jason Buck
This goes back to your humans with probabilistic thinking. Do you remember Charles Sanders Peirce’s abductive reasoning?
Jim O’Shaughnessy
Yes.
Jason Buck
And that abductive reasoning is actually your Bayesian priors. Right. And that’s what we are doing as humans as we’re making these predictions. We had this entire history of inductive or deductive reasoning. We don’t do that. We abductive reason quick and dirty probabilities and then see if that worked. All right, works pretty good. And then we move on.
Jim O’Shaughnessy
I didn’t die.
Jason Buck
Yeah. And similarly, that’s what AI is doing is just predictive token analysis. Right. And then just getting to a probabilistic answer. And do you think part of it—I also wonder Charles Sanders Peirce reminds me of the American pragmatists in one of the greatest philosophies of all time, but never will be respected because it wasn’t continental philosophy.
Jim O’Shaughnessy
No, I know.
Jason Buck
But at the same time, as you know, the history of philosophy is it took extreme wealth to have philosophers who had the free time. And so, as America is the wealthiest country in the world—
Jim O’Shaughnessy
Another great marketer of all time, Plato. Plato knew how to market the shit out of everything he did. His whole academy, all of his dialogues were written after the—with the name of the rich patron that he would go hit up for the money. I mean, the guy was a brilliant marketer. Aristotle, not so much.
Jason Buck
Yeah. All he did was write down a great man’s ideas and create an entire system around it.
Jim O’Shaughnessy
Exactly.
Jason Buck
Who didn’t want to write things down.
Jim O’Shaughnessy
Exactly. And pragmatism, William James. Same thing, right? America, pragmatism is a very robust way of looking at things. And you’re right. That’s so American.
Jason Buck
Well, it’s—pragmatic is in the title.
Jim O’Shaughnessy
Yeah.
Jason Buck
We’re trying to actually get to a solution here. But also, I can’t almost—I wonder if Charles Peirce, also, he tried to pull away from the pragmatists and called it pragmaticism, have his own version. It’s like, are we just drawn to the people that are not only the weirdos of the weirdos. I think because he’s my favorite one a little.
Jim O’Shaughnessy
He’s one of my favorites too, actually. That’s really funny. I didn’t know he was one of yours.
Jason Buck
Yeah. Pragmaticism. So they get—we’ve talked about Diogenes the Cynic before or like EQ in Jim Harrison... It’s just like, are we drawn to the weirdos of the weirdos?
Jim O’Shaughnessy
Kind of. Well, I think just life is so much more interesting in the tails. Right. And that’s another reason why I think that, you know, this interconnectivity is—there’s gold in them thar hills. And in the old days. Right. How many companies could you work for? We were talking about that. Right? And the man in the gray flannel suit was an outcome of the way that society was organized. And our society, because of this awesome ability to connect and convert, there’s lots of little hills that you can power law up. There’s not just one or two anymore, there’s thousands. And that’s why you see this proliferation of Substacks and podcasts and of all of these various things, because people have very different interests. And now you can do pretty well. Who’s the guy who does the 1,000 true fans? Yeah. I love his work. He’s right. You can definitely—your way of investing with the…
Jason Buck
1,000 true fans. That’s what you got. I got to fire 99,000 to get to 1,000. Right? So I’m still working out those numbers. Yeah, we’ve got like 300, so I’m getting there.
Jim O’Shaughnessy
Well, I also love the fact that the name Mutiny and Cockroach, when I first saw that from you, I just laughed out loud. I was like, perfection. It is perfection.
Jason Buck
And hey, our actual first working titles were either Ataraxia or epoché. And so now you get—no, come on. It got to the marketing side of my brain, thankfully. But Ataraxia is unprecedented, unperturbed by external things. That’s the idea. Cockroach. But then epoché is one of my favorites from, I think it’s Pyrrhonian skepticism. But it’s I determine nothing. So that’s what you and I are trying to say. You try to get to the epoché. I determine nothing. Does that give you Ataraxia, eudaimonia? I don’t know. But I can’t determine anything with certainty, right. Because I can’t help the countervailing force. It’s like, I’m susceptible to that argument too, right? And that’s where that juxtaposition—
Jim O’Shaughnessy
And I’m, as you know, writing my first fictional thriller, which is really fun because I’m learning a lot. But one of my characters names all of his shell corporations after Douglas Adams entities. And one of his fellow characters is like, do you name all of your shells using Douglas Adams? And he goes, no, no, just the ones that build worlds because Mega-whatever is the name of his shell. And that’s another thing. One of the things that I found is really cool about AI is I tend to when I’m writing a fictional character, I want to bring them to life as best I can. And so the character bibles I have for my main characters, some of them go to over a thousand pages. Because I’ll sit there for weeks and think about that character.
And then I’ll think, here’s the books that they like. Here are the TV shows they watch. Here’s the music they listen to. Here are the rabbit holes they dive down. And I’m thinking of it for this character, but I can’t remember the 20 pages on Douglas Adams. As much as I love Douglas Adams that I gave to one of my characters, the AI serves as a second brain. And it’s like, yeah, you should name it this because he loves Doug Adams. And after all, dude, you wrote 20 pages.
Jason Buck
Oh, good, he’s in here. I was wondering if Jean-Marc was in here, because one of my other theories is we’re complex schizophrenics. So that’s—you’re like, these characters write themselves. I’m like, do they. Or is this part of Jim we haven’t seen before? Right. It goes back to the homunculus, right? It’s like, no, there’s just one person in here, but no, there’s 30 voices screaming at one time, and the loudest one comes out.
Jim O’Shaughnessy
I contain multitudes, my friend. I contain multitudes.
Jason Buck
Do I contradict myself? Therefore, I contradict myself.
Jim O’Shaughnessy
Therefore, I contradict myself.
Jason Buck
That’s my favorite line.
Jim O’Shaughnessy
It’s one of mine, too. It’s infuriating to people I know, but Jean-Marc will say to me when I’m telling him about the villain who’s named Reinhard Falkenbach. And this is an epic, right? It starts in World War II and ends next year. And it’s—I won’t give it away, but when I’m in the—when I’m in the super villain mode, Jean-Marc will look at me and go, Jim, you’re making those arguments of Reinhard very compelling. So he actually made me a sign that says, never go full Falkenbach. So, yeah, I contain multitudes. What can I tell you, dude? As do you.
Jason Buck
Yeah. When you’re saying about AI, though, I’m curious. You said, this is what I love. You’re like, okay, we called it AI. Before that, we called it LLMs. Before that, we called it machine learning. Before that, we had Excel sheets. Before that, we had human computers. Before that, we had double-entry bookkeeping. Right? You’ve seen it all. So I’m sure you’re aware Schopenhauer had this theory that it was, for every generation you live, it’s selling tickets to the conjurer show, selling tickets to the magic show. And so you’ve seen it all before. So I’m saying we were around when Madonna came out and, oh, my God, look at what Madonna did. Then it was Britney Spears, and then now it’s whoever—whoever the newest one is.
But it’s like, for every successive generation you live, you’ve sold tickets to that conjurer show. So you see it. But what I’m always jealous or envious of with you is, how do you not—how do you maintain your levity and enjoyment when you’ve seen it all before?
Jim O’Shaughnessy
Well, I haven’t. See, that’s the thing. I haven’t seen it all before. You’ve never seen my villain, right? And you’ve never seen my good guy. And I think that it’s—I’m having so much fun remixing. And believe me, Jason, I know it’s a remix, right? I’m not fooling myself. I’m not like, I am the greatest storyteller of all time. I am creating an entirely new universe and no one will have ever—come on. I mean, it is informed by everything I’ve ever read. I love science fiction, I love Tolkien, I love philosophy. And how do I make Nietzsche fun? Maybe I do contain multitudes, but so do you, my friend.
Jason Buck
I appreciate that.
Jim O’Shaughnessy
This has been even more fun than I thought it was going to be. I’m definitely—next time you’re in New York, you got to come back. Because this is what this podcast was really meant to be. Just a very non-formal, non-formatted discussion between people who are interested in stuff. And man, you are that. Why are you going to London?
Jason Buck
There’s a volatility summit that 36South puts on in London and then my wife’s gonna meet me over there. She’s in Bordeaux and Barcelona right now. And then we go to Copenhagen after it.
Jim O’Shaughnessy
So oh well, la-di-da.
Jason Buck
Yeah, I’m very fancy.
Jim O’Shaughnessy
Yeah, you are much fancier than me, man. I’m just slaving away trying to write a fiction thriller. Well, this has been super fun. As you might or might not know, our final question is the one that we ask everyone. We’re going to wave a wand. We’re going to make you the emperor of the world. And I knew—I was thinking about this on my way here because I’m thinking, I think he might just refuse to answer.
Jason Buck
I totally forgot about the question. And then you’re just asking, I’m like—and I almost went to you. What do you think I’m going to say? And like you—okay, okay.
Jim O’Shaughnessy
So you’re the emperor of the world. Just for people who haven’t seen the show before, you can’t kill anyone. You can’t put anyone in a reeducation camp. But you can—we’re going to give you a magical microphone like these here, and you can say two things into it that are going to incept all 8 billion plus people on the planet. Whenever their morning is, they’re going to wake up and they’re going to say, you know, unlike all of the other times that I woke up with two great ideas, this time I’m actually going to act on both of these. I’m going to put both of these into action in my life. What are you going to incept?
Jason Buck
This is the scariest question I’ve ever heard.
Jim O’Shaughnessy
Thank you.
Jason Buck
And like you said, I bristle at it tremendously.
Jim O’Shaughnessy
I thought you would.
Jason Buck
But I do know what you’re doing. This is your feral trickster energy because you just want to see how people respond. And so I think that inherently, as you know, there’s so much solipsism in this question. Right. And this is why I always hated some other questions, like what would you put on a billboard for everybody to see? Which is kind of similar. It’s like, I don’t have ideas I want everybody to see, nor do I want people to think like me. So what would I want people to do? So the first thing that actually popped into my head was actually, I think Stephen Colbert said he was gonna write a children’s book called Fuck It, We’re All Gonna Die. But maybe that’s not a thing to incite people with.
Jim O’Shaughnessy
Yeah, probably not.
Jason Buck
And maybe it goes back to our idea of nihilism and it’s really the quotidian pleasures of the day and I’m thinking about maybe it was over a decade ago, maybe on the Nerdist podcast, it was one of the guys on there was talking about he had moved to LA to become a comedian and he didn’t know anything about LA. So he got a place in Long Beach because it was cheap, which is pretty far from LA and the comedy scene. But he was kind of living, barely getting by, and he’d go and do comedy, everything. But luckily in his neighborhood, there was a Mexican spot that had this great burrito that was very large and very cheap. And every day, this was the joy of his day, was going to eat this burrito.
And it got to the point though, where he would get there, he’d order his burrito, he’d start maybe a third of the way into the burrito, he’s like, this is my joy of my day, everything. And then he’d start thinking about all the shitty things left in the day. And so through the second two-thirds of the burrito, he’s thinking about all the bad parts of his day. So he missed the joy of his day because this is a very human condition, right? So he eventually came up with this moniker, enjoy your burrito. And people tattooed it on—this is a very old thing. And to me that’s the quote, enjoy those quotidian pleasures, enjoy your burrito. So I don’t know if I had a better succinct way of saying that, but we need two.
Jim O’Shaughnessy
We need two.
Jason Buck
The second one, this is very personal and we were just talking about me traveling and having a multi-city tour. I want to incept Americans and Westerners to the joy of the Japanese washlet toilet.
Jim O’Shaughnessy
I have two in my house.
Jason Buck
I have them in my house too. And it depresses me every time I leave my house and go out in this world of barbaric paper. What are we doing in 2026? Water is better than paper.
Jim O’Shaughnessy
Amen, brother. That one will get you a hallelujah.
Jason Buck
I’d build a whole house around that Toto toilet.
Jim O’Shaughnessy
Yes, absolutely. They are the bomb. And we at the point in our house, anyone who comes to our house of the family, where did so-and-so go? They went to the bathroom. You mean the one at the end of—yeah, because it’s the Japanese toilet. They really—I think that is maybe one of the greatest inceptions I’ve ever heard.
Jason Buck
I hope, I hope it catches on.
Jim O’Shaughnessy
I do too.
Jason Buck
I hope I have superpowers.
Jim O’Shaughnessy
Jason. This has been super fun. Thank you for chatting with me.
Jason Buck
Thank you.
