“We’re from the History Department and we’re here to help!”
A phrase that has never been uttered seriously.
But there are some helpful history lessons in the theory of Fast and Slow Time, if you know where to look. Here are a few of those lessons.
For reference, see Parts 1 (the theory) and 2 (the equation)
Slow Time is Loud
Slow Time is rarely boring. It is full of people shouting from the rooftops that you just missed your chance at millions, or all the money you have is about to disappear.
Here are two headlines, less than 3 months apart, from The New York Times.
No Sign of Depression Here Soon1
BUSINESS WARNED OF DEPRESSION2
The year?
1948.
Can you tell me anything, anything of historical significance that happened in 1948 without using ChatGPT?
How did it turn out? The stock market ticked up 5%, real estate was up 2%, and inflation 1%. 1948 was one of the most boring years in American history (except for that “Dewey Defeats Truman” headline).
Loud ≠ Fast.
When Fast Time comes, there is no mistaking it. But most of Slow Time is filled with people very, very sure they know what is about to happen who have no clue what is actually about to happen. Many of those people work in media.
Again, Slow Time is loud.
How to Use Fast Time/Slow Time
If this theory holds, how would you use it?
“The future is unknowable” is both true and useless. You can’t point to a retirement timeline like it’s a map of the New World circa 1492 and write “Here Be Dragons!” (actually, you could and it would be the most amazing client pitch ever). So, here are a few more practical implications of Fast Time/Slow Time.
1) Slow Time is Loud! Do not confuse noise with needing to act: Show clients (or yourself) the contradictory headlines (below). If you want to make your own, simply follow any two active X handles where one is a middle-aged doom poster and the other’s motto is “To the Moon!” There will always be plenty of both. Predicting the future is overrated. Never forget: Slow Time is loud!
2) All Popular Histories Are About Fast Time (that is why they are popular!): Try getting a book deal on the story of stocks between 1973-82. $10,000, reinvesting all dividends, had an inflation adjusted loss of nearly $2,000. “They lost money slowly” isn’t a plot line. I got rejected by 90 agents trying to sell a true history of Americans and their money. 1929, Margin Call, heck even The Wolf of Wall Street are histories of everything going crazy. The point of these stories is not to short the housing market or sell penny stocks. It is to move books and tickets. Let clients know that the book/movie everyone is talking about is life at 4x speed.
3) How to Slow Down Time (or Speed it Up): Liquidity, Debt Deadlines, and Concentration slow time down (or speed it up). Those are the only things in your (or your clients’) control. Back to that HR exec in a crisis from Part 2: if she had built more liquidity (say a larger emergency fund than the “3 months” she was told about), opted for a 30 year mortgage instead of a 15 (spreading out her debt deadlines), or if she had been socking away money into investments and that Etsy business her friends rave about (not concentrating her income streams) she could shelter in place instead of fire selling the house. She could have slowed time down, but once it sped up, time was out of her hands.
You (or your clients) can’t control Volatility or its exponent. All we can do is decide how fragile we are willing to be when it comes. This is true in both directions, of course. Too little exposure and too much liquidity can keep time slow when everyone else is riding the boom. Helping clients see that they are probably living through Slow Time, and the decisions they make now will get stress tested in Fast Time, can help them have (or let them borrow your) historical sensibility. In the equation, ask how an exponential move up or down would impact Concentration or change Debt Deadlines/Liquidity.
This a working theory, both because I’m still working on it and because I’ve spent the last 10 years working with it.
I’ll value your feedback on how to perfect it.
Feb 12, 1948
May 1, 1948