Contrarian Thinking

  • Contrarian thinking doesn’t make sense unless there are still secrets to be discovered
    • Of course, there are many things we don’t yet understand, but some of those things may be impossible to figure out—mysteries rather than secrets. For example, string theory describes the physics of the universe in terms of vibrating one-dimensional objects called “strings.” Is string theory true? You can’t really design experiments to test it. Very few people, if any, could ever understand all its implications. But is that just because it’s difficult? Or is it an impossible mystery? The difference matters. You can achieve difficult things, but you can’t achieve the impossible.

    • Recall the business version of our contrarian question: what valuable company is nobody building? Every correct answer is necessarily a secret: something important and unknown, something hard to do but doable. If there are many secrets left in the world, there are probably many world-changing companies yet to be started.

  • Why has so much of our society come to believe that there are no hard secrets left?
    • Geography, there are no blank spaces left on the map
      • The unknown is less accessible than ever
    • Four social trends
        1. Incrementalism
        • From an early age, we are taught that the right way to do things is to proceed one very small step at a time, day by day, grade by grade. If you overachieve and end up learning something that’s not on the test, you won’t receive credit for it. But in exchange for doing exactly what’s asked of you (and for doing it just a bit better than your peers), you’ll get an A.

          • This process extends all the way up through the tenure track, which is why academics usually chase large numbers of trivial publications instead of new frontiers.

        1. Risk aversion
        • People are scared of secrets because they are scared of being wrong. By definition, a secret hasn’t been vetted by the mainstream. If your goal is to never make a mistake in your life, you shouldn’t look for secrets.

        • The prospect of being lonely but right—dedicating your life to something that no one else believes in—is already hard. The prospect of being lonely and wrong can be unbearable.

        1. Complacency
        • Social elites have the most freedom and ability to explore new thinking, but they seem to believe in secrets the least. Why search for a new secret if you can comfortably collect rents on everything that has already been done? Every fall, the deans at top law schools and business schools welcome the incoming class with the same implicit message: “You got into this elite institution. Your worries are over. You’re set for life.” But that’s probably the kind of thing that’s true only if you don’t believe it.

        1. Flatness
        • As globalization advances, people perceive the world as one homogeneous, highly competitive marketplace: the world is “flat.” Given that assumption, anyone who might have had the ambition to look for a secret will first ask himself: if it were possible to discover something new, wouldn’t someone from the faceless global talent pool of smarter and more creative people have found it already? This voice of doubt can dissuade people from even starting to look for secrets in a world that seems too big a place for any individual to contribute something unique.

    • We can be glad that there are fewer crazy cults now, yet that gain has come at great cost: we have given up our sense of wonder at secrets left to be discovered.

    • To say that there are no secrets left today would mean that we live in a society with no hidden injustices.

  • Two kinds of secrets
      1. Secrets of nature
      • Natural secrets exist all around us; to find them, one must study some undiscovered aspect of the physical world.

      1. Secrets of People
      • Secrets about people are different: they are things that people don’t know about themselves or things they hide because they don’t want others to know.

      • Secrets about people are relatively underappreciated. Maybe that’s because you don’t need a dozen years of higher education to ask the questions that uncover them: What are people not allowed to talk about? What is forbidden or taboo?

    • Sometimes looking for natural secrets and looking for human secrets lead to the same truth
      • Consider the monopoly secret again: competition and capitalism are opposites. If you didn’t already know it, you could discover it the natural, empirical way: do a quantitative study of corporate profits and you’ll see they’re eliminated by competition. But you could also take the human approach and ask: what are people running companies not allowed to say? You would notice that monopolists downplay their monopoly status to avoid scrutiny, while competitive firms strategically exaggerate their uniqueness. The differences between firms only seem small on the surface; in fact, they are enormous.

  • The best place to look for secrets is where no one else is looking
    • Most people think only in terms of what they’ve been taught; schooling itself aims to impart conventional wisdom. So you might ask: are there any fields that matter but haven’t been standardized and institutionalized?

  • Unless you have perfectly conventional beliefs, it’s rarely a good idea to tell everybody everything that you know.
    • If you find a secret, you face a choice: Do you tell anyone? Or do you keep it to yourself? It depends on the secret: some are more dangerous than others. As Faust tells Wagner: “The few who knew what might be learned, Foolish enough to put their whole heart on show, And reveal their feelings to the crowd below, Mankind has always crucified and burned.