Knowledge as a Financial Asset

    If someone offered you $100,000 to take a class for a few weeks, would you do it? I believe most of you would, assuming there is nothing terrible about the class itself.

    But if I change the offer to say you have a 30% chance of making $100,000, would you take the class then? You should, if you need the money and you are rational. But ideally you would find a bunch of classes you could take that all have the same odds. If you take every one of the classes that have a 30% chance of giving you $100,000, one class at a time, your odds of eventually getting the $100,000 are good.

    Investors know that diversifying a portfolio is the smart way to go. But does diversification have the same benefits when applied to learning? I think it does, because knowledge acts like a financial asset.

    I have always looked at learning as money. I evaluate a topic for its economic potential, now and in the future. I have never taken a calligraphy class, for example, because in my case I don’t see how it would ever provide an economic return.

    But years ago I did take the Dale Carnegie course to learn now to become a better public speaker. When combined with my other skill sets it probably gave me a 30% chance of earning an extra $100,000 over my career no matter what path I took. Within any group, the best public speaker often bubbles up to a leadership position.

    I also took classes in my twenties to learn hypnosis. Trust me when I say that understanding hypnosis (and better understanding human minds) is worth more than $100,000 over your lifetime. 

    During my corporate career I signed up for a two-day class on business writing. I didn’t know it at the time, but business writing is almost the same as humor writing. In both cases you leave out the useless words and get to the point. That class was easily worth $100,000 to me because I would have used that skill no matter my career path. And it makes a BIG difference in how people view you.

    My point is that some types of learning are so valuable that they should be ranked by their economic potential. In California, for example, being fluent in Spanish and English is probably worth more than $100,00 over a career, on average.

    Knowing how to do A-B testing on a website is probably worth $100,000 a year.

    Learning how to eat right and exercise right is probably worth more than $100,000 because we know that a person’s appearance influences opportunities. As a bonus, you will be healthier, more energetic, and smarter if you are healthier. That stuff can translate into economic value over time.

    I could go on, but you get the point: Knowledge can be ranked by economic potential. And doing so would change how people approach the “extra” learning after formal schooling is done. 

    It seems to me that one could create a software service that would evaluate what skills you already have, along with your location, age, and other relevant economic factors, and create a learning plan that would give you the greatest odds of higher income later.

    [Side note: This is a system, as opposed to a goal, because you are improving your odds without knowing where it leads.]

    This way of thinking is why I almost never read fiction. One could make an argument that all reading is good for you, and any sort of mental stimulation can translate into economic potential. But I can’t justify reading something with low economic potential when I could be reading something that has greater odds of being useful with my skill set.

    My hypothesis is that successful people see knowledge as a financial asset and manage it that way. They create portfolios of knowledge that make sense as a whole. You could call that a systems-view. 

    People who are struggling (per this hypothesis) are more likely to see the world in terms of goals. A goal-oriented person would not take a class that has unpredictable future benefits when that time could be used instead to focus on a specific goal.

    So I put the question to you. Do you see learning as a system in which you create a diversified portfolio of knowledge that makes sense in your situation?

    Or do you learn what you need when you need it? Let’s call that a goal-oriented approach.

    In Top Tech Blog

    A new Internet of Things chip from Intel, an arm band that replaces your mouse, and soon your screen and camera will be talking behind your back. See it all here.

    If you want to learn more about systems versus goals, and find out why reviewers are saying it has changed their lives, find it here.

Flag Hill: Goal or System?

    Dateline: February 19, 2015. Sunol, CA. 

    My third attempt to reach the top of Flag Hill.

    Background: I tried hiking to the top of this hill in mid 2014. Halfway up I was exhausted and defeated. My younger, better-looking hiking partner was not impressed. She could have sprinted to the summit while texting at the same time. With my manhood in tatters, I slunk down the hill. But I vowed to someday come back and beat Flag Hill. Now it was personal.

    A few months later I tried Flag Hill again but my timing was bad. The bridge to the trail was under construction. So I aborted.

    Last week, with my brother Dave in town, I decided to take a third attempt at Flag Hill. I had been focusing my recent workouts on cardio and lower-body strength. It was time to see if the preparation made a difference.

    Here’s a 22-second video of my training progress on a different hill.

    This is the parking lot at the base of Flag Hill and other trails. My brother is the prime photographer for the day. He’s the tiny pink blob. Above him and to the left is the peak to which we are heading on foot from here.


    The bridge has been repaired since my last failed attempt. So far, so good.


    They still have this warning sign that mother nature intends to kill me one way or another before I leave Flag Hill. But I wasn’t going to let a rattlesnake bite or a rabid mountain lion slow me down. Today was my day.


    It appears there are over seven hundred ways to get lost on these trails. And no phone service. Eek.


    Starts out easy. But this is a fake-out.


    Okay, getting steep now. The trip to the summit is only 1.3 miles but because of the grade we will need to take lots of rest breaks that we will call photo opportunities.


    The rolling foothills are easy. The hard part is in the distance.


    Wow, did we pick a good day. (Apologies to all you folks in snow.) February is rarely this warm in Northern California, and you don’t get many days of green grass. This will be mostly brown in a few months. The area had been fogged-in and cold just an hour before this picture.

    This is the view looking down toward where we started.


    Still looking down the hill.


    Now straight ahead to Flag Hill (below) in the distance.


    The trails are so beautiful you think you are in some sort of fantasy world.


    Even the trees look other-worldly today.


    This rock, below, is at about the halfway point. The first time I hiked this far I was exhausted and had to turn back. This time I had specifically trained for hills, and we paced it better. Apparently the preparation worked because I wasn’t tired at this point.


    Some of the trails are what I imagine I would find on a Peruvian mountain.


    There it is. 

    My nemesis.

    Flag Hill.

    This is the hard part.


    Phew! The steepest part is over. But not done yet.


    A few minutes later a very good day became a spectacular one. 


    Flag Hill, I own you now, buddy. But the rest of you are welcome to visit 🙂

    In the end it wasn’t terrifically challenging because I was better prepared this time and we paced things well. But it sure felt good to finish.

    Some of you will be quick to point out that my quest to climb Flag Hill looks a lot like a goal, and I am the guy who wrote a book saying goals are for losers; systems are better. Allow me to explain.

    Goals make sense for simple, near-term objectives, such as hiking a particular hill. But for complicated and unpredictable situations, such as the arc of your professional career over decades, a system is better, in part because you are unlikely to keep the same priorities and goals over that period. When the environment changes, as it always does, you will change too. A better strategy for the long run is to improve your market value in a variety of ways and hope luck doesn’t ignore you forever.

    My goal of hiking Flag Hill to the top bothered me every day from the moment I set it. It made me feel like a loser for months. That’s why I normally avoid goals. But this one came to me organically when I failed in front of someone I cared about. That made it personal. I had to check it off the list to feel right. 

    I get that way sometimes.

    Luckily I also have a system that involves daily exercise and adding variety to the mix when I can. So in this case my somewhat toxic goal of climbing Flag Hill was a convenient focus for my exercise system, and in that sense it worked.

    I am not eager to set another goal for myself. But I sure am glad this one worked out.



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