In their latest episode of the VALUE: After Hours Podcast, Tobias Carlisle, Jake Taylor, and Phil Pearlman discuss:
- Fitness Alpha: Unlocking Outperformance Through Health and Well-Being
- Stupid Simplicity: Four Pillars of Health and Wellness
- Overachiever’s Dilemma: Rest, Injury, and Staying Consistent
- How Bacterial Mutation Informs Investment Strategy
- What Simone Biles Teaches Us About Strength, Flexibility, and Resilience
- Interoception: Phil’s Path to Emotional and Physical Health
- The Benefits of Intermittent Fasting and Outdoor Movement
- Building Meaningful Relationships and a Supportive Communit
- Forest Bathing Is Crucial for Your Health
- Mental Health and Market Success
- From Wall Street to Wellness
- Staying Fit at 57: Simple Workouts and Personal Challenges
- From 10K Struggles to Enlightenment:
- Is Sleep Tracking Worth It?
You can find out more about the VALUE: After Hours Podcast here – VALUE: After Hours Podcast. You can also listen to the podcast on your favorite podcast platforms here:
Breaker
Overcast
RadioPublic
Stitcher
Transcript
Tobias: This meeting is being livestreamed, which means this is Value: After Hours. I’m Tobias Carlisle. Joined as always by my cohost, Jake Taylor. Our special guest today, I’m energized from talking to him just before we came on, Phil Pearlman of the Pearl Institute. Phil, how are you?
Phil: What’s up, fellas? I’m great. I feel really good. It’s a beautiful day in the northeast in the Hudson Valley. I’m just very grateful to be on the program with you, guys, today. Thanks for the invite.
Tobias: Well, we’re very grateful that you’re here with us. We just wanted to talk about your journey a little bit. You’re a finance markets guy. I follow you on Twitter. I follow your Twitter feed. And these days, it’s health focused. So, maybe you can just talk to us a little bit about where you started and what the journey has been.
===
From Wall Street to Wellness
Phil: Well, I’ve been involved with markets since the 1990s. I had a Datek account, and I was trading JDSU before the NASDAQ bubble burst and began more– And then, I went to grad school in psychology and became very aware of behavioral economics before Kahneman won the Nobel Prize, from a psychology point of view, not from an economics point of view.
So, I was studying the social psychology research that those guys were doing way back in the day, 1974, 1979, early 1980s, when Thaler got involved. I got approached by a hedge fund guy on a golf course in Brooklyn. Dyker Beach Golf Course for people who are– Shoutout Brooklyn back in the day. We were just talking about human behavior and so forth. And he pulled me in. I finished my dissertation, went to work for him, and did that for a long time and got pulled away from psychology into markets.
Markets are super stressful. I was healthy when I was a kid, but I veered away from that with drugs and alcohol as I became an adult. That only got worse with the stress of markets and the stress of my life. Even though I was making money, my life was terrible in a way, and got further and further away from my health for many years.
And then, I went and did many things. I got into social media, and involved with startups and investing, and had a stint at Yahoo and worked with Tumblr. And Tumblr, we created this Tumblr finance thing. So, I did all of that, and really got further and further away from my health, and got further and further away from who I was.
When I was young, I was an athlete. I loved going out and playing ball all day. And so, it wasn’t until about six years ago that I really started to hit bottom, realized, “Hey, I was going to die.” I remember passing out a couple times when I was drinking the same amount as I had been drinking five years previously where my body couldn’t handle it anymore. I was in my 50s and I was like, “Holy shit.” I was 50 pounds heavier or maybe more. I just was like, “Okay, I got to really redo how I do my life.”
And so, I got sober, started taking care of myself, started running races with my son, who was nine and kicking my ass in a 10K or whatever. I got myself really healthy. And then, I started this newsletter, Prime Cuts Newsletter. Started writing about this journey and found that I started getting a lot of really positive feedback back at me like, “Thanks for writing this, or I know exactly what you’re talking about” and people who are further ahead in the journey than me who were reading it.
And so, that got me like, “Okay, I’m making an exit. I’m going to leave finance completely.” Although I really haven’t, because now my clientele, and now a lot of advisors, a lot of entrepreneurs, a lot of people in finance– But I stopped doing anything. I stopped doing anything related to markets formally. As a matter of fact, I’m Mr. Vanguard dollar cost average guy now. I’m like VTI man. Really just started focusing on helping people get healthier.
And also, now, it’s morphed more into helping people with decision making in general. I have a few clients who are hedge fund managers and they’re having problems, whether it’s with tilt and it’s market related, or whether it’s balancing life and not being a stress. I have a direct expe– I went through the same fire. So, that’s where I’m at today.
===
Stupid Simplicity: Four Pillars of Health and Wellness
Tobias: Let’s just start with the health program. What’s your philosophy about getting healthy, staying healthy? What are the big muscle movements that people can do to get themselves on the right track?
Phil: My view is this. I have this model of– Okay, I have two models, and they’re both very straightforward. One is just called stupid simplicity. That is this idea that there’s all of this research going on, and there’s so many arguments occurring within health and that’s at this level of the research and information. And then, there’s a line, and then above that line there’s the functional, and that’s just what works. That is a combination of what has been curated from below the line.
So, what does the research tell us that we know for sure? And N of one, like what works for us? What works for me personally may not work for other people. I mean, I have clients who are vegetarians, and I’m on the edge of being a carnivore and it’s like, “Well, if that works for you and you could sustain that, fine.”
So, this idea of stupid simplicity, is just find the things that work for you and that you are the chief scientist and the sole subject of the most important, continuous experiment that you will ever be involved in, and that is like, “Hey, if you eat something and you feel bad afterwards, don’t eat that again. It’s just so dumb.”.
And then, the other concept that I really utilize is just this very– It’s also part of the stupid simplicity model, and that is that there’s four elements of health. You don’t have to understand anything else. You don’t have to know what mitochondria is. You don’t have to know what your VO2 max is or even what VO2 max means. The four elements are just move your body, put real food into your body, get some rest, listen to your body when you need it. Like, if your hamstring is tweaking, don’t go out and run hard that day. Like, rest your body. And then, four, love and community. That’s it. So, that’s all you have to know to do what I do.
So, I’m not a bright guy. I keep it really stupid simple, and I avoid all of these debates about is Zone 2 better than– If you want to get fast, should you be training in Zone 2 all the time? I don’t really care. I like to run fast. Fast for me to get faster, so that’s what I do. And then, sometimes I run slow, and I’m feeling sluggish and that’s it.
===
Staying Fit at 57: Simple Workouts and Personal Challenges
Tobias: What’s your exercise regimen? You like to run?
Phil: I run a lot. I’m a monist. So, I view everything as mind and body is all one. And so, I run. Recently I’ve been running fast. Maybe once a week, I’ll run slow. Two or three times a week, I’ll run faster. I do a lot of pushups, and pullups and some dumbbell stuff. I have a little gym in my house. That’s where I work out. I don’t do anything crazy fancy.
I have some triceps things and I have a little dip bar, but I just work out when I feel like it. Like, some days I’ll do two exercises, some days I’ll do eight. So, I really mix it up. Very intuitive, I take days off all the time. I’m 57 years old. When I wake up and I feel sluggish or my body, like, something is a little tweaked, the shoulders tweaked or something, I’ll go for a walk.
I do a lot of walking. I got Harriman State Park, like about a minute from my house. I’m in there almost every day, even in the cold with my dog. That one is huge, because that one is really about your mental health too, just getting out there and walking. And so, I really mix it up. This is not like a routine thing. I don’t have a routine. Sometimes I just– whatever I feel like doing that day.
I do have some cadence with the running, because I can’t run every day. And then, I like to add challenges sometimes. In 2025, I want to run a 24-minute 5k. So, I’m just doing that. One year, I did a mile. One year, I tried to do 20 pullups and I failed miserably. [Tobias laughs] I got like 17. So, I didn’t feel miserably, but I failed, but it was fucking awesome like a great failure, because I could do 17 pullups.
Tobias: Yeah. 17 is elite. Strict pullups. Strict bodyweight pullups. Yeah.
Phil: Strict [crosstalk] None of that-
Tobias: Or hang.
Phil: -[crosstalk] or whatever. Yeah, just-
Tobias: Pull hand to the bar.
Phil: -dead hang.
Tobias: Just the bar?
Phil: Yeah.
Tobias: Yeah.
Phil: Yeah.
Jake: What was the mile time you were aiming for?
Phil: Dude, I failed at that too. I’m going to try that this year. I was going for 630 last year, and I got like 651 or 648 or something like that. I think that the tweak– Again, I’m my own scientist for my own experiment. The tweak I’m making now is that I’m doing a lot more shorter, faster runs. Instead of doing this Zone 2, go out and run 10 miles slow, I’m doing these five mile runs fast, and running faster towards the end just to see. Like, maybe that’ll get me there. I think it will, because I’m getting fast– I already know I’ve only been doing it for a little while, I’m already noticing myself getting faster.
===
Interoception: Phil’s Path to Emotional and Physical Health
Tobias: One of the things you talked about was listening to your body, getting some feedback from your bodies. Can you just talk about that a little bit more? What’s the rationale?
Phil: Here’s the thing there, guys. So, we are living in a society, unfortunately, where we have lost connection to our emotional world. We have very big brains. We have this huge frontal cortex with all these folds in it. We can think really, really well. We do so very often at the expense of our emotional system, which is a basic part of the human condition. It’s the most basic– Like, the frontal cortex is up here on the outside. If you drill down into the bottom of the brain, the most primitive part of the brain, that’s the emotional center, like the amygdala or whatever. And so, that part of us is in there. And so, we’re living in this world where we’ve really disconnected from it.
As a matter of fact, that big intellect is so priced from the time you’re in third grade and you either go to that upper class with all this other smart kids or you go to that other class with the kids that are eating paste. It’s like one way or the other you’re going and you become very, very aware of it. Then you take your PSATs and your SATs or whatever. Then what college you get into, then what job you get, then you’re sitting in a meeting trying to sound smart. Nowadays you’re on Twitter arguing about the stupidest shit in the world just to be smart. That’s the same argument you were having when you were in third grade.
So, from my point of view, getting back in touch with our emotional world is really a superpower. If we can do that and listen to it– So, it’s like interoception or it’s like what our body’s cues, are we cold? Are we warm?
We see the same thing with obesity and hunger. Are we hungry or are we sate? Are we filled with energy or are we tired? Are we injured or are we well? Are we scared or are we comfortable? All of those are part of that emotional apparatus that we’ve lost touch with. We could tune back into that and begin to take cues from that, then we are really on our way. So, that’s what I try to do.
I was disconnected from that for a while, man. I remember, early memories of people saying to me, “Hey, you’re cold. Put your coat on.” You know what I mean? I wasn’t cold or whatever. That’s the beginning of the disconnection.
Tobias: Yeah, I do it to my kids all the time. I wanted to ask you do– Yeah, and they complain, “No, I’m not cold. Leave me alone.”
Phil: Yeah. “I’m fine. I’m fine.” That’s them-
Tobias: I’ll stop doing that.
Phil: -pushing back.
Tobias: Yeah.
Phil: Yeah. It’s universal, man. We’re all a part of that culture. We all are doing it. It’s not like a guilty thing. It’s just normal.
===
Overachiever’s Dilemma: Rest, Injury, and Staying Consistent
Tobias: When you’re listening to this feedback a little bit more from your body, how do you balance that with– We’ve all got an inner bitch that says, “I don’t want to do this today. I feel tired.” I think that sometimes probably listen to the inner bitch a little bit too much rather than how do you balance those two? Genuinely, you need a rest or you’re just being weak?
Phil: You, guys, me and your audience are all overachievers by definition, by statistically. Part of the curse of the overachiever is pushing ourselves really hard. It’s not just a curse. There’s two sides to it. It’s also a blessing. We’ve gotten to where we are by pushing ourselves really hard. But at the same time, we get injured.
I got a text from a friend of mine this morning. It was just a photo of his leg up on a thing in a bandage. He fucking got injured. This guy is an incredible athlete who’s incredible condition. And so, finding that line is impossible. It’s never a perfect, perfect science. But if we know the next day we’re going back out there, then we can afford to be patient. So, I will err on the side of caution, just because I’ve been injured so many times.
I get clients all the time who are super overachievers. Very, very successful people who are in their 50s, early 60s, and they have all kinds of injuries that they have to deal with, and they’re going to three different doctors. They have a knee thing, they have a hip thing, they have an elbow thing, and it’s like, “Whoa.” And they’re looking for what more they could be adding.
So, think about that for a minute. You know what I mean? As long as you’re going to get back out there, the next day, I think you can err on the side of caution without having to worry about that day off or falling behind.
Jake: This reminds me of that the ergodicity conversations that we’ve had in the past about the ski racer that really gets after it, and they’ll win a lot more of the races of races like 1, 2, 3, but they end up crashing eventually and then they don’t get to race in the races 4, 5, 6, 7, 8, 9, 10. Whereas the more conservative one actually gets to participate in those. So, losses lead to the foregoing of future gains is one of the takeaways of ergodicity.
Phil: It’s exactly the invert– It’s loss aversion too. You can use that model that, you know, what was the classic quote, “Losses loom larger than gains.” And so, if you are a super elite athlete– If you are a world champion skier, I think they’re operating on a different model than we’re operating. What is our goal? Our goal is to, at least mine, isn’t to win a gold medal in the giant slalom. It’s to be really healthy now, feel great, be a great role model and then be healthy when I turn 70 still have my body operating really well. And so, I think that is a critical distinction between the two.
And so, with the loss aversion, when we lose– We lose money, it feels horrible. It feels worse than making money feels good. That’s the losses loom larger than gains. Exact same concept for injury for all of us mortals. Even us really accomplished mortals. Even a really, really good athlete who isn’t training for the Olympics.
If you are over 35 or 40, and you get injured and you’re out for a month, you get a double loss. There’s your losses are twice as bad. You lose the ability to work out and get stronger, and you lose the time that you would have been working out at that same pace. So, actually, it’s a double loss and you fall further behind. That gets worse the older you get.
So, if you think about it like rationally, it’s really hard to do. If you think about it rationally, that listening to your body thing, that taking a day off thing, as long as you know you’re coming back, There’s a lot of people that what happens is they either get injured or they take a day or two off and then they take another day off. Every day you take a day off after your third day off becomes more difficult to get back on and start working out again.
===
Tobias: Let me give a shoutout to the folks at home. Buenas tardes from Santo Domingo, Dominican Republic. What’s up, Danny? Boise. Tomball, Texas. Andhra Pradesh, India. Brandon, Mississippi. Indiana. Wollongong. Good effort. Early start for you. Cleveland, Toronto, times 2. Pittsburgh. San Tan Valley, Arizona. Valparaiso. What’s up, Mac?
Breckenridge. Tallahassee. Gothenburg, Sweden. G’day from Lausanne in Switzerland. Winter Park, Florida. Savonlinna, Finland. Antwerp, Belgium. Deano in Townsville says, “Most crocodiles can grow up to 18ft, but most only– “Many crocodiles can grow up to 18ft, but most only have 4.” Hamburg, Germany. [chuckles] London. Cincinnati, Ohio. Les Whynin. He’s in Sausage Gully, Australia. Good to see you’ve moved, Les. Jim Carroll says that he likes you pullover Jake.
Jake: Cheers.
===
From 10K Struggles to Enlightenment:
Tobias: Bellevue, California. So, my question, Phil. As you become increasingly sensitive to your own body, is that how you found your journey from finance to this point, you started getting– Tom Morgan, who we had on the podcast a few weeks back said, he gets messages from the universe, and now he’s got a great little email service where he sends emails from the universe, which I subscribe to. It’s good fun. Did you find that you’re getting little breadcrumbs as you were going along your journey?
Phil: There’s no question about that. That’s a great question. So many examples of that. There was a day, maybe, I don’t know, four or five years ago, where I was really starting to get into body movement. I could finish a 10K and I would go out and run it. Like, maybe 10 years ago, I ran this 10K. They do these photos. They try to sell you photos. They get your number and they work with whoever’s putting the race on, and then you get this email.
And so, I got this email of a photo of me crossing the finish line, and I looked like I was about to die. I had this big stomach, and I was just like, [gestures] Like, I was freaking dying. That was a sign from the universe. You know what I mean? Like, that was like, “Dude, you got no right running this 10K. It’s the right idea. You’re being a good dad, because your kid likes to run, but what are you doing? Like, what are you doing, man?”
And so, then about four or five years ago, I was in the Keyes with my family and I was reading this book about– As a matter of fact, I still have it around. I keep it like so close.
I was reading this book called Buddhism for Beginners. And it’s like, if you’re a Westerner– Really internalizing and grokking Buddhism, if you’re a Westerner, is pretty hard, because everything’s black and white to us. There’s winners and losers. People who are rich and poor. We’re very bi-modal. It’s like either, “Okay, you’re over here or you’re over here.”
And so, I’m reading this book, trying to really grasp. There was this one passage about enlightenment. I’m trying to understand enlightenment. You read Siddhartha, and he’s getting enlightened, he’s just sitting under a tree and like– You’re from the States, and you’re like, “What the fuck? What are you talking about?” The Author who knew his audience was just like enlightenment is just rediscovery. That’s it. If you just think of enlightenment as rediscovery, you’re winning. It hit me like a thunderbolt, because I was rediscovering my athletic self.
When I was a kid, I was an athlete. I was running around. I’m from Maryland, I played lacrosse and I was just always outside with the ball with my friends down the street or whoever. I had gotten so far away from that I was not myself. And so, just this process. So, when I read that, I was like, “Oh, wow, I’m getting enlightened right now. I didn’t even know it.” But that is a sign from the universe. It is really just a coincidence. I don’t know, but I guess I was ready to hear it. I was ready to understand and internalize it.
===
Fitness Alpha: Unlocking Outperformance Through Health and Well-Being
Tobias: I like the idea of mind and body being one. I just wanted you to talk a little bit about the idea of how that expresses itself, and then maybe you can just add on to that. You used the word tilt before, which– That’s a poker term for getting emotional, but it applies in the markets just as well that people get emotional and they do silly things in the markets. But is there some interplay between you let your body get so run down that you find that you’re in tilt more often or more frequently or more easily? I don’t want to lead the witness too much, but– [Jake laughs]
Phil: No, this is huge. This is a huge concept. The work I do led me to develop this model that I call Fitness Alpha. And so, there’s all of this research. I experienced it myself N of 1, where as I was getting healthier, I was performing better across multiple modes of experience. I had more energy. Professionally much more effective. As a parent, way more effective. Happier. More ability, a greater ability to tolerate stress, because we live in a stressful world, all of these areas of functioning.
And so, Fitness Alpha is just basically taking this research, these things that we know from basic health research, and applying them to the world of performance. I put it in language that people within the finance world could understand, just calling it Alpha. So, Fitness Alpha is really just how much we outperform based on how healthy we are. So, if there was two Phil’s, there was the unhealthy Phil and the healthy Phil, how much better would the healthy Phil be performing than the unhealthy Phil? There’s so many areas of clear cut, so many domains of clear-cut outperformance from.
Think about it. If you’re managing money, think about these things. Our ability to focus is improved. Our ability tolerate stress is a massive one. Emotional regulation and emotional control, both those are similar, but they’re different. But basically, it’s our ability to experience extreme emotions and tolerate them without having them bubble up into our behavioral world.
That’s when we talk about tilt. That’s exactly what’s happening. So, we’re really upset about our losses. And instead of just being like, “Okay, we’re upset. Going to chill.” We go, “okay, we’re upset about our losses. We got to get that back right away. We’re going to double down.” That’s what happens. You see an increase of risk seeking behavior within the domain of losses where you really should be seeing rationally the opposite. You should be pulling your horns in and taking less risk. That’s what stop losses are all about.
So, this idea of Fitness Alpha to me is just super powerful. It resonates with me personally and it resonates with the money managers that I work with.
===
How Bacterial Mutation Informs Investment Strategy
Tobias: It’s coming up to the top of the hour, which means that it’s JT’s vegetables. Mark it down, folks. Phil, there are people who tune in this show only for the veggies. So, there you go. Top of the hour.
Jake: Well, I don’t know if Phil might not approve of vegetables [crosstalk] if he’s nearly carnivore.
Phil: No, no, no, I love vegetables. [Jake laughs] I’m not a total carnivore, man. I eat salads all the time. Tonight, I’ll have an Israeli salad with chicken. Fiber’s great. Recent findings that fiber lowers the risk of cancer. Go ahead. Sorry.
Jake: Yeah, no worries. So, I think I try to always match up a little bit of the guest and what we’re talking about for the veggies. And so, this is in the world of– we’re going to be talking about bacteria. Bacteria are some of the most adaptable organisms on earth surviving billions of years, and really by doing one thing exceptionally well, which is mutating. I think anything that’s lasted billions of years is worth studying. There’s just some proof in the pudding.
So, mutation is a bacterium’s way of adapting to change. Whether it’s a new environment, a hostile immune system that they’re part of, or a sudden flood of antibiotics, they have to be ready to really mutate. But not all bacteria mutate at the same rate. So, some are like speed demons and they’re rapidly changing to keep up with their environment. Others are much slower and they’re making small adjustments.
The reason for these differences are fascinating. So, for instance, the bacteria which causes tuberculosis has a very slow mutation rate. Why? It tends to live in relatively stable environments. They’ve evolved a very robust DNA repair mechanisms to avoid subjecting themselves to errors in the DNA replication process.
There’s another example of a slow mutating bacterium that’s– I won’t try to pronounce it. It’s hard. It’s in the marine, in the ocean. It’s distinguished by its small genome and a low rate of mutation in comparison to most bacteria. So, it’s really this effective DNA repair that lets them do slow– prevent excessive mutation. So, they basically have a strategy of like, fix it really well rather than reshuffle the cards and see what might become a better fit. So, two different strategies that you see mother nature testing out.
Now, on the other hand, bacteria that are facing a high stress environment, they tend to mutate much faster, because their survival depends on it. There’s another interesting observation that might be relevant to a future analogy that we might make. Even within the same bacteria, not all parts of the DNA mutate equally. There are some regions that are hotbeds of change, and then there’s others that remain steadfast and stable and they resist mutation.
So, all right, what analogies from billions of years of successful survival can we torture out of this? In volatile, fast changing market environments, you might want to be more open to– open your investment process to more change and flexibility. If the pace of the change in the world is really increasing, maybe all of us stodgy “principled investors.” Well, like maybe we’re in for a wake-up call, I don’t know.
So, maybe if you’re a VC or someone who’s focused on really early business, early in their life cycle, where you might expect more change if you’re on that bleeding edge, maybe you need to have a more adaptable investment process. It’s always easy to make fun of VC community for bouncing around to whatever seems like it’s hot. There’s SaaS to crypto to AI, whatever the next thing is, but maybe that’s actually an evolutionarily sound strategy. I don’t know, I think we maybe should be more curious and less judgmental about that.
And then, just like I said that there are those certain regions of DNA that are resistant to change and there are other parts where that should– Those are the parts that should remain stable. There’s probably also parts of your investment process that should remain stable. Maybe wouldn’t be subject to whatever’s happening in the market. So, call these your core principles. As Thomas Jefferson may or may not have said, “In matters of principle, stand like a rock. In matters of style, swim with the current,” just like a bacterium. Okay. He didn’t say that last part. [Tobias laughs] I just added that.
So, I think it’s interesting you might want to spend some time thinking about your own investment process and your environment and how much change would actually be appropriate. Like, what would be the optimal amount of change that you might look for? And maybe here’s some simple rules of thumb that might help. Look at your environment and the pace of change. If it’s stable, maybe focus on refining what works. If it’s unpredictable, maybe you need to experiment more. Protect your slow, mutating core, these are your timeless principles, the anchors that ground your decision making no matter what.
I think it’s an under discussed topic in finance generally. But how can you embrace the right amount of change at the right time? Too little, and you’re stuck in the past too much, and you risk following fashion and just bouncing around, which we know probably doesn’t work most of the time.
So, I’m just curious for both of you, over time I know that Toby, especially yours, you’ve made some tweaks and changes. I know that there’s a lot of firm principles as well. But have you thought about like, why to change one part versus another depending upon environment or what’s being selected for?
Tobias: Yeah, it’s hard. There are plenty of business biographies of investors who in the mid-1990s they saw the market getting extremely expensive for the first time, got into cash. There’s really been no opportunity since then that would have matched that same valuation as in– If they were looking at, say Shiller PE or something like that.
Jake: Yeah, definitely would have led you astray.
Tobias: You never– [crosstalk] Yeah. So, you need to be more flexible in that. But equally, as we all know, if you’re always using whatever strategy or style is working right now, then you’re going to trail, because it’s just the nature of it, the law of ever-changing cycle says that the thing that hasn’t been working is going to start looking a little bit better. And the thing that’s been working really well gets a little bit crowded and starts working less well. So, that’s the tension. You have to be surviving without trailing too much. I don’t know if there’s any good solution to it, but Phil’s been around longer than I’d have. What do you think, Phil?
===
What Simone Biles Teaches Us About Strength, Flexibility, and Resilience
Phil: Well, patience helps. But the thing that you really made me think about Jake while you were talking and this is so out of left field, is Simone Biles. The reason that you made me think about her is because she is the greatest example of dynamic flexibility that ever existed. She’s incredible. She came back after having a difficult Olympics, and then came back and won later. That was part of that dynamic flexibility. But the thing about her dynamic flexibility that stands out to me is not the flexibility part, because that’s the obvious. Like, she could do 10 backflips or whatever. But is the control component. So, she’s really combining flexibility and control both at the same time. It’s a dynamic. I use that word on purpose. It’s a dynamic process.
Think about that. Yu would almost think of them as polar opposites, flexibility, control. But really for her, they’re more of a dialectic where she’s commanding both to varying degrees at the same time. That is what you were talking about with the bacteria with like, in some parts of the bacteria, they’re changing very quickly, they’re mutating incredibly quickly. Where other parts– That is incredible. No wonder they survive for millions of years.
Tobias: There’s a good idea in there, Phil that– The flexibility and the strength, that’s one thing that I’ve been investigating a little bit, is how do you get more flexible? One of the counterintuitive ideas in getting more flexible is that you need to get stronger. Your lack of flexibility is your body trying to protect you, because you’re not strong enough if you get into that. If you get too stretched out, you just don’t have enough muscle there. So, a lot of the mobility guys, the kettlebell mobility type guys, they work through these exercises where the idea is to get stronger in that stretch state, and that’s how you improve your flexibility. Have you looked at any of that kind of stuff?
Phil: The thing I think about there– I just started doing a plyometrics program with my son for the winter. During the winter, we’re going to get twitchy. That’s the term the cool kids in plyometrics use. “We’re going to get really twitchy this winter.” But the thing that you made me think about in that comment, is that when we think about the word flexibility, we usually think about two things. We think about physical flexibility, which is the Simone Biles thing, touching your toes, being able to do a tree pose or a garland pose or whatever.
And then, this idea, and this is really pertinent to markets, cognitive flexibility. That is having this ability to change our mind and not to get stuck in our own rigid, conformational type of thinking where we hold onto a stock too long, because we really believe and we don’t want to let go. And then, there’s this third level that nobody talks about.
So, there’s the physical flexibility, there is the cognitive flexibility and then there’s this other level where that I call core-self flexibility, where we’re able to actually change who we are at almost any age. It’s like, if you’re 84, maybe it’s hard. But if you’re 60, or 50, or 40 or 30, you have the capacity to fundamentally change who you are, and how you operate and experience in the world. To me, that’s really, really powerful.
===
Mental Health and Market Success
Tobias: I got a couple of questions from the audience, Phil, that I want to throw at you. The first one is, “Can Philip discuss any advice he has around mental health advice when dealing with financial markets? Any big connections between the physical and mental health states?” So, we started down this path before, but yeah.
Phil: Yes. So, I do this presentation on Fitness Alpha for advisors, for the layperson, for entrepreneurs and also for market participants. And so, there are things in the world and especially in markets that we can control and things that we cannot control. We cannot control rates, we cannot control price, even though we may fantasize that we can. But what we can control is this apparatus. This is part of our tool set for market participation is our own body. We can control that. The healthier that we get, the more we know for a fact that we get better at being able to regulate our emotions, that we get better at being able to focus, that we get better at being more dynamic, like what you’re saying about strength and control. We get stronger. We have more force, like, that ability to press a winner or take a loss. We have more stress tolerance.
Years like 2022 happen. I don’t know, every five, six, seven years, you guys probably know better than me. You get punched, you get the crap beaten out of you on a Wednesday, you have to still wake up Thursday morning and go back into the office and turn the machines on and begin interacting with the market again and having clients. And so, that capacity to do that improves. So, improved metabolic health will help you in your performance in the markets all day long in ways you never suspected.
There’s a great book called Brain Energy by a guy named Palmer who talks about this metabolic health and mental health specifically, but that trickles down into every other aspect, we’re just one animal.
Tobias: That’s great stuff.
Phil: Palmer. Great book. Highly recommend. Brain Energy, I think it’s called.
===
Is Sleep Tracking Worth It?
Tobias: That was from Tyler Pharris, who’s our unofficial producer. I got one from Lotto Allocator. “What does Phil think about sleep tracking and using mattresses like Sleep Number or Eight Sleep to be more scientific about biometrics during sleep?”
Phil: Well, my first choice is this. Going back to the discussion we were having about tuning into how you feel, whether you’re tired– One of the examples I gave, whether you’re tired or filled with energy, you wake up in the morning and you either feel like, “Hey, I’m ready to get up,” or you feel exhausted or you feel somewhere in between. I think that’s primary and comes before the quantitative self. I think that the quantitative self can be great. I think especially with people who are– This goes to the sleep example. People who are wrestling with drugs and alcohol. When they–
I’ll do work with these guys. I got incredibly successful people, but they’re functional alcoholics or kindaholics, I call them. They’re not aware of how much they’re being affected. So, we do this thing where we take a look at their sleep data on days that they drink and days that they don’t. They see that they—So, there’s a place for quantitative self. I’ve been using it recently. I got my buddy, Parekh, is telling me, “AI and the quantitative self, you got to be on board.” So, I’m trying it. Never really wore a watch before, but now I am, and I’m finding myself getting pulled to it and so forth. I don’t wear it when I’m sleeping.
But if you wake up in the morning and you feel rested, it trumps whatever your watch is telling you, whatever your ring or your mattress is telling you. So, tune into that. That’s human intelligence, not artificial intelligence.
Tobias: Yeah, I second that. When I had my third kid, I hadn’t slept for about-
Jake: You look great for it, by the way.
Tobias: -four years before then. [laughs] I just felt like I was not ever getting any sleep with the baby. So, I got a Fitbit to track it to see if that was actually happening. I found that the things that really affected my sleep, alcohol really affected my sleep, which was noticeable, so I cut back on that pretty substantially. But I also found that overeating really affected sleep. So, if you eat too much just before you go to bed, that’s a disaster.
But the one that I really didn’t expect was if you work out too hard or if I worked out too hard, if I really wiped myself out in the gym, then I’d have a terrible night’s sleep that night too, which that didn’t match with what I had thought. As a kid, I thought, you go out and you work really hard, then you get a really good night’s sleep. It doesn’t work that way. Either it doesn’t work that way or it doesn’t work that way as you get older.
So, I used that Fitbit for a while. I ultimately got rid of it. I got rid of it, because I just found I was going back to it all the time. I was using it too much. I had it for two years. [crosstalk] Yeah, I learned what I needed to learn, and then I got rid of it and I’m-
Phil: Perfect.
Tobias: -now best of both worlds.
Phil: Perfect. Yeah. Yeah, you ever notice that you have Google Maps– Whenever I go on vacation, I pull up this Google Maps, and I’m using it to get everywhere and I have no idea where I am. My wife and kids are in the car, and they’ve learned the landscape, but I haven’t because I’m using Google Maps, because I’m the one who has to get us there.
Tobias: Yeah, you’re watching the map and not the landscape.
Phil: Right.
===
Forest Bathing Is Crucial for Your Health
Tobias: I wanted to ask a question about– Japan has this idea of forest bathing. I don’t know their word for it, but that’s– The Nordics or Sweden has this idea of forest bathing. They’ve probably got a word for– That sounds like it comes from an IKEA catalog, but I don’t know what that word is either. You go for a walk with your dog or by yourself through the forest? What’s the research or what’s the feeling that you– What’s the purpose for that?
Phil: For millions of years of evolution, we have been out in nature. When the sun goes down and it gets dark, we sleep. When the sun comes up in the morning, we’re up and doing our thing. And then, suddenly, 100 years ago or more, a little bit more, but a blink of evolution in the evolutionary time frame, we began having gas and then electric lighting. All of a sudden, we began moving away, further and further away from nature.
So, we are animals that require nature the same way we require water, or we require food or we require connection with others. That’s my view. I feel it every time that I get out. If I don’t get out for a couple days, if it’s like raining or terrible weather for two days, I’m feeling very disconnected.
There is research in that area and it’s– But to me, the more profound argument is really just a basic animal one. Like, every animal in the animal kingdom, their hearts are beating. Our hearts are beating too. We’re just animals. We just have, like I was saying before, big frontal cortexes. But really, we’re just animals. We’re going to die one day. The original drum will eventually stop beating. Being outside and circadian rhythm and all of those things are super elemental. They’re, again, culturally something that we’ve gotten away from over four or five, six generations.
Tobias: JT, you would be advocate for the hike. Do you still have time to go on your hikes?
Jake: I do. That’s one of my preferred things in life is to put the weighted vest, on and go for a hike and listen to the Berkshire AGM audio. I feel like I’m checking a lot of boxes at the same time, which is [chuckles] what gets me excited is. I don’t like to just check one box if I can– [crosstalk]
Tobias: That’s mind and body, spirit all in one.
Jake: Yeah, all unified.
===
The Benefits of Intermittent Fasting and Outdoor Movement
Tobias: I got some good exchange in the chat here. “What’s the financial equivalent of fiber?” “BRK Shareholder letters.” “Difficult to fully digest, but good for you.” [chuckles] Good line. So, Phil, what’s a typical day look like for you? Are you waking up before dawn? Are you one of the advocates for-
Jake: Two hours of meditation.
Tobias: -04:00 AM journaling?
Jake: Yeah.
Phil: I’m the complete opposite of that. All of that is just what I call fitness porn. Like, fitness porn is bullshit. You don’t need a thick book. Like I was saying before, you don’t need to understand how mitochondria work. You don’t need to know a lot of things. You don’t need to do– In fact, routines, I hate routines. And so, there’s no typical day for me, but I do generally wake up early. Sometimes on a Sunday morning, I’ll just completely sleep in.
But I usually wake up pretty early. I like to get outside. Very first thing, I take my dog out. We usually stay out there. Sometimes I’ll chase her. She doesn’t know how to play fetch. Like, I’ll throw the ball, she’ll get it and then she’ll wait for me to come over and then she’ll run away. So, it becomes like this zoomies thing. So, that gets my heart pumping like right away.
Then I’ll go inside. I usually make my kid breakfast. I only got one left in the house. And so, I’m just relishing every minute. So, I make him breakfast, and then take him to school. And then, I usually get outside. I’m usually back either running or hiking in the woods and I’m back before the open. I don’t really start with clients until 10 o’clock or 11 o’clock. Black coffee, water. Don’t usually eat till about 4 o’clock in the afternoon.
So, I guess I do have some routines. I don’t really think about it that way. But whatever I do– Some days, I wake up and I’m like “Okay, I’m going to do this today.” Like, today was a day where it’s like– I’ve been really on this run fast kick. So, I just ran about four miles as fast as I could and I was like, “Okay.” I feel great the rest of the day. So, there is some variability.
Tobias: What’s the drive for the intermittent fasting? How long have you been intermittent fasting?
Phil: I don’t know, I’ve been doing it like maybe five years. It’s incredible to me, because number one, it keeps me from eating in the evening. You were talking about sleep and eating in the evening. If you eat right before you go to bed, your body starts working. It starts digesting, your body temperature rises. When you go to sleep, you want your body temperature to come down and you don’t want to want it to be working. So, setting that limit of like 7 o’clock, maybe 8 o’clock at latest, you stop eating, you give your body a chance to digest.
In addition to that, it makes me more intentional about what I eat and when I eat. I love eating. 02:30, about now I’m starting to feel, “Okay, what are we going to eat tonight, man. What are we eating?” I’m really thinking about it. And then, 04:00 or 04:30, 5 o’clock maybe I have something to eat. It’s like that first thing I put in my body is like good, like it’s like grilled chicken or grilled beef or today, I have some like hard boiled eggs sitting there, I’m going to eat those, and then make dinner for my family. That’s the thing.
The other thing, and I don’t even know if this is true or not and I don’t understand not one of those things that I can really feel or touch yet, but there’s this idea of autophagy that when we don’t eat for periods of time, our body gives itself a chance to heal. I want to believe. That’s a faith thing. There’s a little bit of God in there. I want to believe. And so, if it’s true, it’ll be great that I practice it. But I’m not 100% sure, because I can’t directly feel it at least yet.
Tobias: Yeah, I like the idea of that– I do a little bit of intermittent fasting too. I think one of the things that it does is it just helps you separate eating for boredom and eating for hunger. Once you get used to being hungry, it makes it easier to eat for hunger.
Phil: That’s a great point. That is going back to what we were talking about interoception and how we feel. It’s like you really tune into how you feel. It’s like, I’m really hungry now, as opposed to I’m sitting on the couch watching Netflix, just mindlessly eating Funyuns.
===
Building Meaningful Relationships and a Supportive Communit
Tobias: We’ve got five minutes, Phil. I realize we’ve missed one of your legs, said Tyler Pharris. Thank you very much for bringing this one up. “Does Phil have any extra details on his love/connection health advice? Any pointers for developing stronger family and friends relationships?” That’s a great point.
Phil: Okay. So, here’s the thing with that. We are from the moment that we look into our primary caregivers’ eyes, when we are an infant, we are connected to other people. This is a relational view of the world and I am a proponent. There is no personality without other people. And so, that is a fundamental. Just like ants all work together. We are as fundamentally social and humanistic as ants or whatever. And so, that part of us, we must nourish the same way that we put healthy foods into our body. That means our family, that means our immediate family as we become adults. It means our family of origin from the time that we’re adults to the time that we die. It means our community.
You were asking before about serendipity, about things that I’ve discovered that were true as they happened or like that Buddhist saying, “When the student is ready, the teacher appears,” or whatever. It’s exactly like that. When we reach out and we are willing, not just to our wives and kids, but to our close friends–
I’ve been friends with since second grade. He mentioned that his wife was ill. And so, I just reached out to him yesterday. He’s like, “Hey, how’s Debbie doing? How’s your wife doing?” Like that, to me, is the thing, those kind of things. I think you will find in that same way that the teacher appears. You’ll find that you begin to function better, things begin to make sense, things begin to fall into place. We become more grateful. We become more thankful for our lives. Our mood improves.
And so, I include love and community in the four elements of good health. It’s really, really simple. You don’t have to know mitochondria to move your body, eat real food, rest and love and be willing to allow yourself to be loved.
Tobias: Yeah, I think that community thing is a little bit underappreciated. It’s not something that we talk about enough, but I think it is a very powerful thing. I think there’s a lot of problem with those blue zone studies, but it is pretty clear that those blue zones all have pretty good little communities. What do you think about that?
Phil: There’s a great book by Waldinger called The Good Life that I would highly recommend.
Tobias: Good name.
Phil: He is the executive director of a huge longitudinal study at Harvard that’s been going on since the 1930s where they studied– What’s that?
Jake: The Framingham study?
Phil: Is that what it was called originally?
Jake: There’s a really multigenerational longer one that’s [crosstalk]
Phil: Multigeneration. That’s the one.
Jake: Yeah.
Phil: Right. So, it was that guy who started it and they have expanded it. When they started, it was low SES, like Southies in Boston, and then Harvard students who tended to be higher socioeconomic status. It was all male and it was circumscribed. It was fairly small and it was longitudinal. So, it was going on over time. They had so much success with it that they just kept building these concentric circles. Women in, the children of the original subjects, the grandchildren, now the great grandchildren.
What they found was that longevity and well-being were more associated with our connection to the people around us and to our community than how many burpees we could do or what our VO2 max was or any of that kind of stuff.
===
Tobias: That’s good stuff, Phil. It’s been an absolute pleasure having you today. We’re coming up on time. If folks want to follow along with what you’re doing or get in contact with you, what’s the best way of doing that?
Phil: You can reach out to me directly at ppearlmen@gmail.com or you could just go to philpearlman.com and you’ll get– That’s the thing to do. Go to philpearlman.com, you’ll get my Twitter, you’ll get my newsletter, is there prime cuts. You’ll be able to contact me, find out more about me. That’s probably it. philpearlman.com.
Tobias: You’re also on Twitter. What’s your Twitter handle?
Phil: Twitter, @ppearlman, P-P-E-A-R-L-M-A-N. Yeah, that’s a wild place, man. These days, it’s gotten crazy. [Jake laughs] Crazy.
Tobias: JT, any final words?
Jake: Nothing to add.
Tobias: Nothing to add. Phil Pearlman, thank you very much. Folks, we’ll see you next week.
Phil: Cheers, guys.
For all the latest news and podcasts, join our free newsletter here.
Don’t forget to check out our FREE Large Cap 1000 – Stock Screener, here at The Acquirer’s Multiple:
