Chapter 22 - Benjamin Franklin, Volume 1
Today's Chapter is based on the book “Benjamin Franklin, Volume 1” by Carl Van Doren, a biography of Benjamin Franklin.
Buy it on Amazon here:
https://www.amazon.com/Benjamin-Franklin-Carl-Van-Doren/dp/193154185X
Here's what I have learned from the book:
Social Creature
“Man is by nature a social animal.”
— Aristotle
Benjamin Franklin believed that human beings are social creatures and that socializing with others is an essential part of a fulfilling life. He believed that people should actively seek out social connections and build relationships with others, rather than isolating themselves. As a matter of fact, Franklin believed that having all the knowledge in the world is useless if you cannot share it with anyone.
“Man is a sociable being, and it is, for aught I know, one of the worst of punishments to be excluded from society.”
— Benjamin Franklin
“One of the philosophers, I think it was Plato, used to say that he had rather be the veriest stupid block in nature than the possessor of all knowledge without some intelligent being to communicate it to.”
— Benjamin Franklin
As a matter of fact, Franklin was a strong believer that sharing knowledge and information with a group of individuals, usually smarter than you, is a great way of learning things faster. In fact, various studies show that peer groups are super influential in your learning. The reasoning behind it can be easily understood by this famous saying: “you are the sum of the five people that you hang around with the most.” As such, Benjamin Franklin created a club for mutual improvement where he invited 12 members for mutual improvement called the Junto. During their exclusive meetings, the members of the Junto were asked to discuss about a few topics notably:
What they have read and learned in history, morality, poetry, physic, travels, mechanic arts or other parts of knowledge;
Stories of failed business/businessmen and the reasons why they failed;
“…every member, in his turn, should produce one or more queries on any point of morals, politics, or natural philosophy, to be discussed by the company; and once in three months produce and read an essay of his own writing, on any subject he pleased.”
— Benjamin Franklin on the rules of the Junto
Furthermore, with his involvement with the Junto, Franklin realised how people working together can achieve powerful things for the community and to each other. Notably, Franklin through the connections he acquired with the Junto, became the founding member of many organisations, such as the American Philosophical Society and the Pennsylvania Hospital, which were dedicated to promoting education, science, and healthcare. More importantly, Franklin was the one behind the creation of the Library Company of Philadelphia, which came from a suggestion he made at the Junto in 1730:
“that, since our books were often referred to in our disquisitions upon the queries, it might be convenient to us to have them all together where we met, that upon occasion they might be consulted; and by thus clubbing our books to a common library, we should, while we liked to keep them together, have each of us the advantage of using the books of all the other members, which would be nearly as beneficial as if each owned the whole. It was liked and agreed to, and we filled one end of the room with such books as we could best spare.”
— Benjamin Franklin
Virtues
“Virtue is a habit of the soul, inclined towards the good, and aiming at the right action.”
— Aristotle
While Benjamin Franklin is famous for being a Founding Father of the United States, he is even more reknown for being a polymath. During his career, Franklin was active as a writer, a scientist, a politician, an inventor, a philanthropist and many more. He is the perfect example of a multidisciplinary thinker that Charlie Munger asks us to become. In fact, it is no surprise that Benjamin Franklin is one of Munger’s all-time hero.
“If you skillfully follow the multidisciplinary path, you will never wish to come back. It would be like cutting off your hands.”
— Charlie Munger
More importantly, Franklin has established in his writings thirteen virtues that are absolutely necessary to lead the perfect life:
Temperance: Eat not to dullness; drink not to elevation.
Silence: Speak not but what may benefit others or yourself; avoid trifling conversation.
Order: Let all your things have their places; let each part of your business have its time.
Resolution: Resolve to perform what you ought; perform without fail what you resolve.
Frugality: Make no expense but to do good to others or yourself; i.e., waste nothing.
Industry: Lose no time; be always employed in something useful; cut off all unnecessary actions.
Sincerity: Use no hurtful deceit; think innocently and justly, and, if you speak, speak accordingly.
Justice: Wrong none by doing injuries, or omitting the benefits that are your duty.
Moderation: Avoid extremes; forbear resenting injuries so much as you think they deserve.
Cleanliness: Tolerate no uncleanliness in body, clothes, or habitation.
Tranquillity: Be not disturbed at trifles, or at accidents common or unavoidable.
Chastity: Rarely use venery but for health or offspring, never to dullness, weakness, or the injury of your own or another's peace or reputation.
Humility: Imitate Jesus and Socrates.
“My intention being to acquire the habitude of all these virtues, I judg’d it would be well not to distract my attention by attempting the whole at once, but to fix it on one of them at a time; and, when I should be master of that, then to proceed to another, and so on, till I should have gone thro’ the thirteen; and, as the previous acquisition of some might facilitate the acquisition of certain others, I arrang’d them with that view, as they stand above.”
— Benjamin Franklin
On top of these virtues, Franklin, in 1726, wrote to himself a few resolutions to live like a rational individual. Rules that we should all live by:
It is necessary for me to be extremely frugal for some time, till I have paid what I owe.
To endeavour to speak true in every instance, to give nobody expectations that are not likely to be answered, but aim at sincerity in every word and action: the most amiable excellence in a rational being.
To apply myself industriously to whatever business I take in hand, and not divert my mind from my business by any foolish project of growing suddenly rich; for industry and patience are the surest means of plenty.
I resolve to speak ill of no man whatever, not even in a matter of truth; but rather by some means excuse the faults I hear charged upon others, and upon proper occasions speak all the good I know of everybody.
Temperance
“Temperance first, as it tends to procure that coolness and clearness of head, which is so necessary where constant vigilance was to be kept up, and guard maintained against the unremitting attraction of ancient habits, and the force of perpetual temptations.”
— Benjamin Franklin
As we have mentioned in a previous Chapter on Michael Jordan, temperance is required to succeed in investing and in business. As Warren Buffett once mentioned, “Success in investing doesn’t correlate with IQ. Once you have ordinary intelligence, what you need is the temperament to control the urges that get other people into trouble in investing.”
In fact, investors need to avoid making decisions under their internal cognitive biases and external factors such as irrational movement from the stock market and irrelevant news. To do so, we must be able to face the challenge of inactivity. As Blaise Pascal once said “All human unhappiness comes from not being able to sit quietly in a room alone.”
“It takes character to sit there with all that cash and do nothing. I didn't get to where I am by going after mediocre opportunities.”
— Charlie Munger
This is especially true in the current environment we live in with social media and information being as accessible as it has ever been. In fact, America's past-time has been slowly changing from baseball to more fast-paced sports like basketball and football. I believe that part of the reason for this is because baseball requires more knowledge and patience and yet, lack actions compared the two other sports.
As such, it is crucial to arrange rules and an environment to avoid making big decision under irrational emotions.For example, investors can apply this by setting rules such as only putting trade orders when the market is closed and only following stock prices once per month, etc.
Another example is the idea of waiting a certain time before responding an unhappy email when you know you are currently in an irrational state:
“Another one, for example, that I think a lot of smart people say is, “If you're angry about something, or if you get an unhappy email and you want to respond, don't respond for 24 hours.” What does that do? You calm down. The emotions subside, the hormones go down, and you're in a better mental state 24 hours later.”
— Naval Ravikant
Do not fear inactivity, as it does bring huge benefits to those that are able to master their emotions and their urge of action. As a matter of fact, this intelligent behaviour has allowed great investors such as Nick Sleep and Warren Buffet more time to read and think. It is no wonder that this super ability has allowed Buffett to find time to learn and improve even at his age.
“If you take Warren Buffett and watched him with a time clock, I would say half of all the time he spends is sitting on his ass and reading.”
— Charlie Munger
"If you take Berkshire Hathaway, which is certainly one of the best-regarded corporations in the world and may have the best long-term investment record in the entire history of civilization, the skill that got Berkshire through one decade would not have sufficed to get it through the next decade with the achievements made.Without Warren Buffett being a learning machine — a continuous learning machine, the record would have been absolutely impossible."
— Charlie Munger
Silence
“My desire being to gain knowledge at the same time that I improv’d in virtue, and considering that in conversation it was obtain’d rather by the use of the ears than of the tongue, and therefore wishing to break a habit I was getting into of prattling, punning, and joking, which only made me acceptable to trifling company, I gave Silence the second place.”
— Benjamin Franklin
For Benjamin Franklin, Silence is the second most important virtue after Temperance. This is an important virtue as it allows one to obtain the habit of listening rather than speaking in a conversation. To remind himself of the importance of silence, Franklin used to write under the pen name of Silence Dogood (”Silence do good”).
As we have learned from Sam Zell previously, listening is a crucial skill while negotiating as it allows you to understand what is truly important to the other person:
“This is perhaps my most fundamental principle of entrepreneurialism, and to success in general. But my experience with Mrs. D was also about the value of really listening, which is at the heart of any negotiation. Understanding what’s truly important to the other person out of the dozen or so things they might tell you. Mrs. D’s brother had to be taken care of. That was her bottom line. Homing in on that got the deal done.”
— Sam Zell
Similarly, as Abraham Lincoln once said, it is “better to remain silent and be thought of a fool than to speak out and remove all doubt.” This is the reason why Napoleon instructed the viceroy of Italy on the importance of speaking and to listen to others:
“Speak as little as possible. Your knowledge is too limited and your education has been too neglected for you to engage freely in discussions. Be able to listen, and be assured that silence often produces the same effect as wisdom. Be not ashamed of asking questions.”
— Napoleon
As such, a rule of thumb during any debate is to stay silent unless you understand the opposite arguments better than the other side. It takes a lot of learning and listening before being able to hold an opinion on a subject.
“The ability to destroy your ideas rapidly instead of slowly when the occasion is right is one of the most valuable things. You have to work hard on it. Ask yourself what are the arguments on the other side. It’s bad to have an opinion you’re proud of if you can’t state the arguments for the other side better than your opponents. This is a great mental discipline.” — Charlie Munger
A good way to know separate those with true knowledge and those who are ignorant is by listening and asking questions rather than talking. Franklin, out of admiration for Socrates, learned to stop doing the talking and to put on the hat of a humble inquirer and doubter. He took a great pleasure to use the Socratic Approach to make a fool of various “experts”.
“I found this method safest for myself and very embarrassing to those against whom I used it; therefore I took a delight in it, practised it continually, and grew very expert in drawing people, even of superior knowledge, into concessions the consequences of which they did not foresee; entangling them in difficulties out of which they could not extricate themselves, and so obtaining victories that neither myself nor my cause always deserved.”
— Benjamin Franklin
As we have seen previously with Richard Feynman, knowledge can be fragile and we are the easiest person to fool. By consequence, silence is a great virtue to have to avoid making a fool of ourselves on subjects that are outside of our true circles of competence.
“The first principle is that you must not fool yourself-and you are the easiest person to fool. So you have to be very careful about that. After you’ve not fooled yourself, it’s easy not to fool other scientists. You just have to be honest in a conventional way after that.”
— Richard Feynman
Writing
“The next thing most like living one’s life over again seems to be a recollection of that life, and to make that recollection as durable as possible by putting it down in writing.”
— Benjamin Franklin
Benjamin Franklin is an avid believer that “all should be taught to write a fair hand, and swift, as that is useful to all.”As a matter of fact, as a printer and publisher, Franklin was able to see the impact of his writing in improving the daily life of himself and of others Philadelphians. Notably, in the hope of improving the education system of the youth in Philadelphia, Franklin worked on establishing an academy by writing and publishing a pamphlet.
"Peace being concluded, and the Association business therefore at an end, I turned my thoughts again to the affair of establishing an academy. The first step I took was to associate in the design a number of active friends, of whom the Junto furnished a good part; the next was to write and publish a pamphlet, entitled Proposals Relating to the Education of Youth in Pennsylvania."
— Benjamin Franklin
In fact, Franklin believed that everyone should be taught “arithmetic, accounts and some of the first principles of geometry and astronomy. Not only the skill but the habit of keeping accounts should be acquired by all as being necessary to all.” Not only that, he also stressed on the importance for people to learn to draw, if they are unable to write, as it is a great way to express their thoughts.
“Drawing is a kind of universal language, understood by all nations. A man may often express his ideas, even to his own countrymen, more clearly with a lead pencil or bit of chalk than with his tongue.”
— Benjamin Franklin
“Drawing is no less useful to a mechanic than to a gentleman…By little skill of this kind the workman may perfect his own idea of the thing to be done before he begins to work; and show a draft for the encouragement and satisfaction of his employer."
— Benjamin Franklin
The importance of writing can also be seen in the way of learning. As a matter of fact, by writing about a topic at hand, you must be able to compress your ideas into words which requires both understanding and thinking. As such, writing is a great process to understand things better yourself and to identify the topics that you understand from those that you do not know what you are talking about.
“A good writer doesn’t just think, and then write down what he thought, as a sort of transcript. A good writer will almost always discover new things in the process of writing.”
— Paul Graham
Finally, writing is a great tool for better decision making. In fact, by keeping a decision journal at hand, you will be able to collect feedbacks from your previous decisions in the hope of making better decisions in the future. Writing it down on a journal is crucial as it allows you to review all the circumstances and accessible knowledge you had at the time of your decision and to truly evaluate it without being obstructed by hindsight bias.
“Go down to a local drugstore and buy a very cheap notebook and start keeping track of your decisions. And the specific idea is whenever you’re making a consequential decision, something going in or out of the portfolio, just take a moment to think, write down what you expect to happen, why you expect it to happen and then actually, and this is optional, but probably a great idea, is write down how you feel about the situation, both physically and even emotionally. Just, how do you feel? I feel tired. I feel good, or this stock is really draining me. Whatever you think.
The key to doing this is that it prevents something called hindsight bias, which is no matter what happens in the world, we tend to look back on our decision-making process, and we tilt it in a way that looks more favorable to us, right? So we have a bias to explain what has happened.”
— Daniel Kahneman
Beyond the Book
Read "Ben Franklin: The Thirteen Necessary Virtues" by Farnam Street
Read "Ben Franklin and the Virtues and Ills of Pursuing Luxury" by Farnam Street
Read "The Work Required to Have an Opinion" by Farnam Street
Read "Why Write?" by Farnam Street
Read "Creating a Decision Journal: Template And Example Included" by Farnam Street