The Purpose of Wealth Is Freedom - Akira the Don, Naval Ravikant

Everyone vaguely knows

That they want to be wealthy

But they don’t have

A good set of principles

To do it by

Wealth is then thing that you really want

Wealth is assets that earn while you sleep

Wealth is the factory

The robots

That’s cranking out things

Wealth is the computer program that’s running at night

That’s serving

Other

Customers

Wealth is

Even money in the bank that is being reinvested into other assets

And into other businesses

Even a house can be a form of wealth

Because you can rent it out

Wealth is

Businesses and assets that can earn while you sleep

Wealth is

Businesses and assets that can earn while you sleep

But really the reason you want wealth

Is because it buys you freedom

The purpose of wealth

Is freedom

So you don’t have to wear a tie like a collar around your neck

So, you don’t have to wake up at 7:00 AM

And rush to work

And sit in commute traffic

So you don’t have to waste away your entire life

Grinding all your productive hours away

Into a soulless job that doesn’t fulfill you

It’s really just so that you are your own sovereign individual

You’re not going to get that unless you really want it

And the entire world wants it

And the entire world is working hard at it

And to some extent it is competitive

It’s a positive sum game

But there are competitive elements to it

Because there’s a finite amount of resources right now in society

And to get the resources to do what you want

You have to stand out

Money is how we transfer wealth

Money is social credits

It is the ability to have credits and debits of other people’s time

If I do my job right

If I create value for society

Society says

«Oh, thank you

We owe you something in the future for the work that you did in the past

Here’s a little IOU

Let’s call that money.»

Wealth is

Businesses and assets that can earn while you sleep

Wealth is

Businesses and assets that can earn while you sleep

There are fundamentally two huge games in life that people play

One is the money game

Because money is not going to solve all of your problems

But it’s going to solve all of your money problems

I think people know that

They realize that, so they want to make money

But at the same time

Many of them deep down believe that they can’t make it

They don’t want any wealth creation to happen

They sort of virtue signal by attacking the whole enterprise by saying

«Well, making money is evil.

You shouldn’t do it.

Blah blah blah.»

They’re actually playing the other game

Which is a status game

They’re trying to be high status

In the eyes of other people watching

Status is just your ranking in the social hierarchy

Status is just your ranking in the social hierarchy

So

Wealth is not a zero-sum game

Everybody in the world can have a house

Because you have a house doesn’t take away from my ability to have a house

If anything, the more houses that are built

The easier it becomes to build houses

The more we know about building houses

The more people that can have houses

So

Wealth is a very positive sum game

Status, on the other hand, is a zero-sum game

It’s a very old game

We’ve been playing it since monkey tribes

It’s hierarchical

Who’s number one?

Who’s number two?

Who’s number three?

And for number three to move to number two

Number two has to move out of that slot

So, status is a zero-sum game

Politics is an example of a status game

Even sports is an example of a status game

To be the winner, there must be a loser

I don’t fundamentally love status games

They play an important role in our society

So we can figure out who’s in charge

But fundamentally

You play them because they’re a necessary evil

Wealth is

Businesses and assets that can earn while you sleep

Wealth is

Businesses and assets that can earn while you sleep

But really the reason you want wealth

Is because it buys you your freedom

The purpose of wealth

Is freedom

But there’s always a subtle competition going on between status and wealth

For example, when journalists attack rich people

They’re really bidding for status

They’re saying, «No, the people are more important

And I, the journalist, represent the people

And therefore I am more important»

The problem is that by playing these status games

To win at a status game

You have to put somebody else down

That’s why you should avoid status games in your life

Because they make you into an angry combative person

You’re always fighting to put other people down

To put yourself and the people you like up

Just realize that most of the times

When you’re trying to create wealth

You’re actually getting attacked by someone else

And they’re trying to look like a goody-two shoes

But really what they’re doing

Is they’re trying to up their own status at your expense

They’re just playing a different game

And it’s a worse game

It’s a zero-sum game

Instead of a positive sum game