Hari here. After years at the intersection of credit, lending, and markets, what I’ve noticed is this: the same handful of concepts keep surfacing — in business decisions, in geopolitical headlines, in conversations about strategy. Most people have heard the terms. Fewer have had someone sit down and actually explain them. Mental Mosaic Explains (ahem, better title suggestions welcome!) is my attempt to do that — one concept at a time, clearly enough to be useful whether you’re watching the news, having a debate with a friend, picking up the Wall Street Journal, or running a business.

The first topic: Tariffs

Tariffs have become a political football — but they carry real-world consequences. While the exact figures are often debated, tariffs trickle down to everyone’s pocketbook. Cars, for example, are expected to cost $2,000–$4,000 more due to higher steel prices. Appliances often cost hundreds more.

As a practitioner who finances loans for companies, I see consequences that ripple far beyond the headlines. Companies that import goods suddenly face cost increases they didn’t budget for and can’t always pass on. So they adapt — buying their goods upfront to beat the next round of increases, cutting costs wherever they can, laying off workers, and raising prices when margins leave no other choice. Each decision is rational in isolation.

Together, they signal something more troubling: a business under pressure, making short-term moves that quietly erode the foundation a lender underwrote (rant over).

It’s been on people’s minds, and, perhaps because the topic has been politicized over the last decade, it isn’t surprising that I am frequently asked to explain what tariffs are.

Back to Basics — What are tariffs, anyway?

A tariff is a tax, duty, or levy on an imported good. Primarily used as a protectionist measure, tariffs work by making foreign products more expensive, nudging consumers toward domestic alternatives.

Who imposes them? The government. More specifically, here in the U.S., Congress has the right to collect taxes (as affirmed by a Supreme Court ruling in February). But throughout the 20th and 21st centuries, it has largely delegated that power to the Executive branch.

Who pays for them? The importer of that particular good is under the tariff. Goods arrive at a port of entry, and the buyer pays customs duties and tariffs, usually before the goods are cleared to leave the port.

But who REALLY pays?

It’s the rest of us: Because a tariff is an added expense on an importer, who hopes to sell these goods domestically or use them as a production input in their own operations, they would likely defend their margins by passing those costs on to the consumer.

And we’re at the mercy of the importers: If there’s a 10% tariff on a $100 imported good, assuming a 100% pass-through rate, that product effectively costs $110 after the tax. Now, in reality, the importer often tries to find ways to cut costs: push back on the producer, take a slightly lower profit, or find other efficiencies where possible. Very rarely do a 100% of the tariff pass through to the consumer.

And it doesn’t just hurt buyers; it hurts market efficiency: Those who would have purchased at the lower price don’t, and, assuming a foreign country isn’t dumping goods into the local economy, resources flow toward less efficient producers. In short, tariffs transfer money from consumers to producers and the government — and create waste in the process.

FYI — who doesn’t pay for them? Foreign governments. But they do hurt as well. Exporters from countries whose goods are subject to tariffs might end up losing buyers in the country imposing them. All in all, not good for free trade.

So, why do countries impose them?

#1- Level the playing field: When foreign goods are priced artificially low, domestic companies can’t compete. Tariffs close the gap and protect jobs.

Ex: The U.S. has repeatedly imposed tariffs on imported steel sold below cost, protecting domestic steelmakers from being undercut by cheaper foreign production.

#2- Keep harmful goods out: Some imports are unsafe or low quality. Tariffs make them less accessible, nudging consumers toward better options.

Ex: The U.S. imposed steep tariffs on imported tires in 2009 after foreign manufacturers were found to be flooding the market with cheaper, lower-quality alternatives.

#3- Control critical supply chains: Chips, energy, defense materials. If another country makes it, they can cut you off. Tariffs incentivize making it yourself.

Ex: The U.S. has pushed heavy tariffs on foreign semiconductors and backed domestic chip manufacturing through the CHIPS Act — reducing dependence on overseas production for technology critical to defense and industry.

#4- Retaliation: You tax us, we tax you.

Ex: During the 2018 trade war, retaliatory tariffs by China of U.S. soy imports hurt American farmers.

In Conclusion:

Tariffs are not inherently bad. They have their place. In the 1990s and 2000s, as manufacturing jobs migrated to lower-wage countries, tariffs were seen by many as a legitimate tool to protect domestic workers. During COVID, the vulnerability became visceral — basic drugs, medical supplies, and critical goods were being produced overseas because it was simply too expensive to make them at home. A well-placed tariff might have changed that calculus.

• Tariffs have been in use for around 6,000 years: The imposition of tariffs goes back to ancient Mesopotamia, through to ancient Egypt, Greece, and into our modern times, where it was imposed for pretty much the exact same reasons noted above.

• Tariffs were the government’s main source of revenue pre-1913: Before the enactment of the Sixteenth Amendment in 1913, which allowed for the income tax, tariffs were the primary source of U.S. government revenue.

• The word “tariff” comes from Arabic: The word tariff comes from the Arabic word ta’rif, which pretty much means the same thing. The Arabic word comes from the root ‘Arafa, which means to make known.

  ---

We're drowning in data. I'll throw you a lifeline with three important numbers impacting you.

1. Oil has its groove back

For a while, Tesla, solar panels, and wind farms made it easy to write oil’s obituary. Then came Iran. Now it’s front and center of every discourse — and for good reason. Brent crude oil is trading above $111 a barrel, up nearly $48 from a year ago.

Setting aside the complexities of pollution and climate for a moment, the reality is that oil touches everything.

The cost to ship goods, the raw materials in your favorite shirt, the fertilizer that grew your food — it all traces back to oil. When the price goes up at the source, it goes up at the register.

Does this mean more “Buy Now, Pay Later?”

Source: Colorado Oil and Gas Association

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2. Should you have been a Doctor?

The unemployment rate held steady at 4.3% in March — layoff headlines and the Iran conflict haven’t moved the needle. AI hasn’t replaced humans. Yet.

Who’s hiring: Healthcare added 76,000 jobs.

Who’s firing: The federal government shed 18,000, finance another 16,000.

Hold your horses: A spike in healthcare hiring reflects the end of a workers’ strike and seasonal warming — not a structural shift, economists tell Reuters.

Elsewhere, employers are firmly in “wait and see” mode.

3. Richie Rich?

A 50-year American Enterprise Institute (AEI) study says 31% of US households are now upper-middle class — up from 10% in 1979. This is defined as USD $133,000- $400,000.

The share living in poverty (earning <$40,000) dropped from 30% to 19%.

The unconventional thesis: Maybe the middle class is hollowing out because they're moving on up.

The catch: Income went up. So did everything else, from housing, schooling, child care, and transportation. Many of those upwardly mobile families don’t feel richer, and feelings vote.

Share with someone who might be interested.

As always, I deeply appreciate your time reading.

Thanks,

Hari

“Between what is said and not meant, and what is meant and not said, most of love is lost.” - Khalil Gibran.

Sooner or later, you're sitting across from someone who wants something different from what you do. And it is often a sad fact of life that negotiations, by their very nature, place both sides in an antagonistic, zero-sum tussle (if not an actual struggle). When both parties come into it with that mindset, what is said between them during the talks is only the tip of the iceberg. Go below sea level, and you will find that each side has an underwater frozen mountain of intentions, desires, stresses, and conflicts driving that tussle and ready to sink the deal.

It got me thinking about the aforementioned quote by Lebanese-American poet Khalil Gibran. Swap love for deals. Swap it for peace. The gap is the same.

Ultimately, every negotiation has two layers: what’s being discussed, and what each party actually needs — the visible and the invisible. The argument on the surface is never really the argument.

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The Conflict: Every Demand Has a Shadow

The visible is what people argue about. These are the obvious stated agenda items. These can include price, terms, structure, time, stated positions, and perceived options.

The invisible is what’s actually driving the negotiations. They’re what the parties are actually fighting for and what has brought them to the negotiation table. These are things like causality (why they’re there), the narrative they tell themselves (history, identity, culture, emotion), the true constraints they face, their actual options, and timing (as opposed to time).

We see these factors come into play in almost any negotiations.

Zoom in: Take a typical divorce settlement:

• The visible: Add up the assets, subtract the liabilities, split the difference.

• The invisible: Anger, betrayal, rage, and grief — emotions that rarely get a seat at the table.

Zoom out: We can even see this interplay in global affairs, including the current conflict in the Middle East:

• The visible: We have sanctions, strikes, and nuclear brinkmanship, and the Strait of Hormuz.

• The invisible: We have survival, sovereignty, historical ethnic and religious grievances, and the control of a region that powers the global economy.

The Conflict: Ignore the invisible at your own peril

On the surface, it seems pretty obvious that people negotiate for the material and stated outcomes, and that they won’t engage in an inherently antagonistic interaction with their cards on the table. So, why bother with the invisible? (What’s underneath the iceberg.)

Because for most, the visible is there to satisfy the invisible need. Without satisfying the latter, most negotiations either break down or one side ends up feeling wronged by the deal. And deals can fall apart after an agreement is reached.

Furthermore, engaging only on face value is inherently limiting and risks one losing the prize. That is because:

• Limitations of language: Negotiations are verbal, and language only approximates intent, not necessarily reflecting each party's needs. Language can also become a tool of misdirection as much as communication.

• Fog of War: People guard information like currency, revealing only what advances their position and withholding what might expose their need, true position, and real constraints.

• BATNA: And by failing to analyze the invisible properly, one fails at discovering their true leverage: When to walk away or their Best Alternative to a Negotiated Agreement (BATNA). A BATNA gives the clearest picture of what walking away would actually cost. It forces a reckoning with reality rather than ego.

The Framework: Drive to unearth the invisible

When entering a negotiation, the first job isn’t to state your position — it’s to map the invisible needs beneath it by:

• Understanding each side’s real pain points: What are their true constraints, including time, financial and other material costs, and reputational damage?

• Running an honest BATNA analysis to figure out when and at what point to walk away.

• Perception vs Reality: Understanding what the perceived options are as opposed to the actual options.

• Narrative vs price: Taking the other side’s emotions, history, and grievances seriously enough to actually understand them. Addressing the narrative, not just the price, may keep the deal alive well after the talks are done.

Not to agree. To Understand

And when mapping the invisible, it helps to ask the following questions:

• What are they saying? (visible)

• What must be true for them to say it? (invisible)

• What can’t they change? (constraint)

• What story are they protecting? (narrative)

• How many options do they think they have? (perception)

• Who is under real-time pressure? (timing)

• Will they regret this deal later? (aftermath)

Remember, a deal is only real when both sides feel they gave something up. The best negotiators don’t just win. They make the other side feel like they did too.

The iceberg doesn’t warn you. It just waits.

Tell us about a recent negotiation:

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Hey there, Reader

Hari here. We’re trying something new and giving you a little reprieve this week from my musings (please hold the applause until later).

I want to give a special thank-you to for being the first contributor to Mental Mosaic’s new series.

Mosaic Minds is a monthly feature penned by leaders in business, finance, and other sectors, who’ll share their hard-won wisdom, experiences, and lessons. It will be a peek inside the mind of some of the smartest, most insightful, engaging, and funny people I’ve met who’ve built and achieved much.

Please, give this a read, and support Dead Hand Capital. They publish an investment newsletter devoted to the forgotten virtues of patience, silence, and rationality in a world addicted to motion, written by someone with 20 years on Wall Street.

The Velocity Of Conviction

The investor’s mind is paralyzed by the illusion of choice. We have been taught that the ultimate luxury is to keep our options open, to delay commitment until every variable is known, every risk quantified, and every outcome guaranteed.

But the stock market does not reward the hesitant, nor does it spare the frantic. It rewards those with the capacity to make committed decisions.

In the market, there are two distinct species of participant: the Weather Vane and the Forge. They are defined entirely by their relationship with conviction.

The vast majority of market participants are Weather Vanes. They are paralyzed by the abundance of information and when presented with an opportunity, they do not act. They run a thousand simulations, wait for the macroeconomic clouds to part, for the central bank to issue a guarantee, and for their peers' consensus to validate their intuition. They decide slowly because they are searching for a mythical state of perfect certainty.

But perfect information only exists in the past, and the past pays no premium. By the time the Weather Vane finally musters the courage to allocate capital, the opportunity has already been seized by the decisive. And because their decisions are born of consensus rather than internal, unborrowed conviction, they are terrifyingly fragile. The moment the wind changes, they vomit up their holdings in a fit of maximum capitulation disguised as “risk management.”

Enter the Forge: To the untrained eye, the man who reaches decisions promptly appears reckless. When the market violently dislocates, throwing the shares of a magnificent, irreplaceable institution into the gutter, the Forge deploys capital with a speed that looks impulsive.

But it is not impulsivity, and the decision was not made in a moment of chaos. It was made months, perhaps years prior, in the solitude of quiet study.

The testing ground: Back in 2020, the world had stopped spinning. The pandemic had frozen global logistics, shattered supply chains, and driven the market into a blind, indiscriminate panic. Concurrently, the geopolitical anvil dropped: the U.S. Department of Commerce added China’s premier foundry, SMIC, to its Entity List. The financial press sounded warnings about the death of globalization and the collapse of the semiconductor cycle.

In the crosshairs of this dual shock was ASML, the Dutch masters of extreme ultraviolet lithography. The stock plunged as the Weather Vanes frantically liquidated.

Our decision to aggressively accumulate ASML in that moment of maximum terror was prompt. But it was not made in 2020.

The decision had been pre-loaded years prior. We had already spent the time considering the physics of EUV. We knew that ASML possessed a literal monopoly on light—an unbreachable moat built on precision engineering that bordered on sorcery.

When the pandemic and the SMIC blacklisting intersected to drive the price down to that exact threshold, there was no need to form a committee or run a simulation. The spring was already coiled.

We knew that a virus does not alter the laws of physics. We knew that the blacklisting of SMIC did not reduce the world’s need for smaller, faster silicon. If anything, the geopolitical fracturing weaponized that need, turning ASML’s machines into the apex capital goods of the 21st century. The underlying reality of the enterprise had not been impaired; only the quoted price had become temporarily inconvenient.

We executed the standing order. And then, we engaged in the second, far more grueling half of the equation: we changed our minds very slowly.

This is the agonizing burden of true conviction. Once the concrete is poured, you do not dig up the foundation every morning to check if the steel is still there. We ignored the daily infection rates, the geopolitical posturing, and the erratic, red flashes of the stock market. We anchored ourselves to the weight of ASML’s monopoly, ignoring the volatility of the headlines.

The lesson? The market is a machine designed to make you doubt your prompt decisions. It will tempt you to “do something” to alleviate the discomfort of looking foolish in the first-order timeframe. But if you have done the reading, if you have verified the structural advantage, you must grant your investment the dignity of time.

We are entering an era of accelerating noise. The machines will generate infinite reasons to hesitate, and infinite reasons to panic. The premium placed on the velocity of conviction will only widen.

You must be intentional in your outlook. Will you be the Weather Vane, spinning wildly in the crosswinds of consensus, always deciding too late and abandoning too early?

Or will you do the quiet work in the dark? Will you know the price of your convictions before the market asks for them?

When the pitch finally crosses the plate, you must swing. And once you have swung, you must have the courage to watch the ball fly—even if its flight looks uncertain.

Stay still.

Win slow.

Theodore

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Mental Mosaic’s mission is to turn rare ideas into tools for high-agency leaders. It’s a confusing, complicated, ever-changing world, and many people are looking for guidance, especially when it comes to leadership or decision-making. If you have a unique angle or experience to share, I’d love to hear from you.

Reply to this post or send me a message, and I’ll be in touch soon.

In Manhattan’s Diamond District, jeweler Howard Ratner convinces Kevin Garnett to leave his NBA championship ring as collateral for a supposedly priceless Ethiopian opal. Howard, played by Adam Sandler, subsequently pawns the NBA ring and bets everything on Garnett’s next game.

Watching Uncut Gems feels like a panic attack. Howard’s entire world depends on five things going right simultaneously: the opal sells, the bet hits, the collectors wait, the next loan closes, and nobody pulls the thread early. He sprints through Manhattan, dodges debt collectors, sweet-talks jewelers, and places bet after bet with unshakable certainty that this time, everything will land.

Every successful person will tell you to bet on yourself. Howard believed that, too. The best operators carry his certainty.

They just never let the whole structure depend on every variable cooperating at once.

Howard only ever ran one scenario. No fallback. No downside case. Just the version where everything lands.

Here is what makes Howard so unsettling: he is not delusional. He is not stupid. He reads the room, he knows his market, he moves fast. He just didn’t understand the probability of success and the swings. In another life, with one or two variables rearranged, he is a success story. The problem was never his conviction. It was that he had no answer for what happens when things go wrong. And in that silence, every bet he placed was really just a prayer dressed up as a plan.

Most people operate closer to Howard than they would like to admit. They run the optimistic scenario in their head: the promotion comes through, the big house will be affordable, the client signs, the market holds, my idea is the best. And they call it a strategy.

The greatest investors, operators, and leaders share Howard’s fire. What separates them is a habit most people find deeply uncomfortable: they spend as much energy imagining failure as they do engineering success. They are, in the best possible sense, paranoid.

Howard was intensely optimistic. He just skipped the second half.

In lending, we make large loans that may take years to repay. We are, by definition, forecasting the future—will the business work out, will competitors stay at bay, will the economy hold up —some may say a fool’s errand.

But being unable to predict the future isn’t an excuse to stop preparing for it. It’s exactly the reason you must.

The Stress Test

The tool we use to understand the future is called stress testing. Every loan we underwrite runs three cases, and the order matters.

Start with the downside. Before optimism, before the base assumptions, ask what can go wrong and whether you can survive it. Not just financially. Professionally. Emotionally. Most people overestimate their risk tolerance until the risk is actually in the room.

1. Ask yourself the downside case: What if I’m wrong, and what exactly breaks? What must go right? Where are the single points of failure? How much margin do I actually have, not the margin I’m assuming? If the worst scenario occurs, will I survive it? You can use math, common sense, and your worst critic.

2. Then build the base case: Not the dream, not the nightmare. The honest, unsentimental answer to one question: if nothing goes particularly right and nothing goes particularly wrong, what happens? The base case lives in the uncomfortable middle, which is exactly why most people skip it. It forces you to separate what you know from what you’re hoping for.

3. Finally, run the optimistic case. But give it a job: does the upside justify the exposure? This is where Howard lived permanently, and it’s a fine place to visit. It is a catastrophic place to live. If your downside is ruin and your optimistic case is merely good, the deal doesn’t work. Howard’s optimistic case was life-changing. His downside was everything. That asymmetry should have stopped him cold.

It didn’t.

The best operators run all three. They carry Howard’s certainty into the optimistic case and Howard’s outcome into the downside, and they let the gap between the two tell them whether to move.

Why It Matters

Good decision-making isn’t about pessimism. It’s about clarity. The downside case doesn’t exist to talk you out of things. It exists to ensure that when you move, you do so with your eyes open.

Also, when things go wrong, you have thought through what changes you can make.

Years ago, we looked at financing a large tool manufacturer. On the surface, it looked attractive: a near monopoly in its niche, a strong brand, loyal customers. The numbers were good. The story was better.

But when we stress-tested the projections, something uncomfortable emerged: If revenue dropped just 5%, the company wouldn’t be able to service its debt.

Why would revenue drop? It hasn’t in the past, and now we are leveraging the company. Bet the Opal: “This is how I win.”

It would have been easy to convince ourselves of the upside.

So we walked away. Not because the company was bad. Not because the brand wasn’t real or the market position wasn’t earned. We walked away because we recognized what was happening: we were being seduced by a good story. The upside was loud. The risk was quiet. And in that gap, between what the numbers said and what we wanted to believe, was where the decision lived.

The hardest part of good judgment isn’t identifying risk. It’s catching yourself in the moment when optimism has already dressed itself up as analysis.

Howard never caught himself. He was too busy running. Don’t be Howard. Carry his fire. Build his floor.

Be intensely optimistic about the future.
Build the downside first.

Hi Reader,

It’s Hari. Mosaic Signals are mid-cycle updates between our twice-monthly flagship pieces. High signal, less polish, and improvisation. Thank you for going along for this ride with me.

A. Tax season has me looking at last year’s expenses. They went up. They always go up. Not because we decided to spend more. Because we never decided not to.

Zero-based budgeting rejects that entirely. Every expense justifies its existence from scratch. No autopilot. 3G Capital made it famous at Kraft Heinz (yes, the Ketchup!). Every department, every dollar, defend it or lose it. They stripped the company to the studs.

The job. The habits. The commitments you inherited from a younger version of yourself.

Anything that wouldn’t survive that question is legacy overhead.

Try it. Pick one area of your life and zero it out. What makes it back in?

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B. Last week, a friend and I nearly came to blows over whether the Giants have a real shot this year. Voices raised, stats flying, neither of us budging. Then we ordered another round.

We already know how to disagree well: sports, pizza, movies. We go back and forth on what we know, what we don’t, what we love, and what drives us crazy. We don’t belittle someone for backing the wrong side. In fact, we cheer them on for being loyalists. And when the final whistle blows, we share a drink.

Maybe those conversations need a final whistle too.

C. When I was building Periodikal, I’d get anxious about asking. For advice. For a follow-up. For anything that felt like imposing.

Always ask. Always follow up. Silence isn’t a no.

Thanks,

Hari

The small sushi shop was off the beaten path, away from tourists. Google Maps struggles to navigate Kyoto’s byzantine streets, bustling with activity. Little crooked lanes branched off the main ones. We finally found the hole in the wall. A sign hung on the corner with deference: ‘Sorry, I can only seat five people.’

As we entered, the sushi chef smiled as though he’d been expecting us. We were relieved to be the only ones there. As we sat down, from the corner of my eye, I could see little notes of customer affection for the elderly chef: ‘We had seven sets. Wish I could eat more.’ ‘We had five sets.’

He pulled out his phone, spoke in Japanese, and let it translate to English. He carefully handed us the menu. Asked where we were visiting from. When we mentioned New York, he asked whether we thought the new mayor could bring down prices. He kept detailed notes on every customer who visited. He knew exactly when the person who sent us had visited, down to the date and time.

Once we placed the order, it was all business. His hands moved with quiet precision, each cut deliberate, each placement intentional. He had been operating the restaurant since the 1970s. A little boredom would be justified. There was none. As he placed the sushi in front of us, he told us which to eat with and without soy sauce. This was a command. We were not to mess up his work.

Japan, as I found out, has a lot of amazing sushi. But the unreasonable care of this man in his tiny restaurant will stay with me forever. Not because of the fish. Because you could feel that this was his life’s work, and he refused to be casual about it.

That refusal is becoming rare. In the age of technology, gross margin protection, and quarterly earnings, most businesses have optimized the care out of the process. The customer feels it immediately. Not as outrage. As indifference. A shrug where there used to be a standard.

The pattern is simple. When people care about what they do, customers never have to ask for more. When they don’t, no amount of process can fake it.

So the question worth sitting with isn’t how do we improve the work.

And if the answer is no, the honest move is to stop doing it and find the thing you’d refuse to be casual about. The sushi chef didn’t need a mission statement. He had a five-seat counter and fifty years of proof.

He’s not alone. But he’s increasingly outnumbered.

The Case for Unreasonable Care

We’ve all sat through the call tree. Pressed 1, pressed 3, repeated our account number twice, only to reach someone reading a script. Now the script is an AI chatbot. The human has been optimized out entirely, and it’s celebrated as a win for the bottom line.

Care is increasingly reserved for the top end. We’ve all walked past business class to economy. But care was never supposed to be a seating class. Some companies still prove it doesn’t have to be:

Zappos: A customer once stayed on the phone with a Zappos rep for 10 hours and 43 minutes. The call covered life, relationships, and yes, shoes. Reps weren’t measured on call time. They were trained to build connections, not rush. Founder Tony Hsieh built the entire model around one idea: treat support as marketing, not a cost center. Long-term loyalty over short-term efficiency.

Chewy: When customers call to cancel after a pet passes away, Chewy doesn’t process the transaction. They send handwritten sympathy cards. Flowers. Refunds with no return required. They tell customers to donate the unused food to a local shelter. If you’ve ever loved a dog, imagine that call. That emotional moment doesn’t just resolve an account. It defines the brand. Emotional intelligence scales.

The Omakase Principle

Omakase literally means “I’ll leave it up to you.” It’s the ultimate expression of trust between customer and craftsperson. But that trust is only earned through obsessive care. The framework has four steps:

Seat — Define your constraint. What’s your five-seat counter? Shrink the surface area until you can feel every interaction.

Select — Audit ruthlessly. Do I care about this? If yes, go deeper. If no, cut it. The chef didn’t offer mediocre tempura. He made sushi and nothing else.

Command — Find your soy sauce moment. If you don’t have an opinion about how your work should be experienced, you don’t care enough yet.

Sustain — Apply the boredom test. Fifty years and still no boredom? That’s care. Boredom creeping in? That’s not a discipline problem. That’s a signal to move on.

The beauty of omakase is that the customer surrenders control and gets something better than what they would have chosen. That only works when the person behind the counter has cared long enough and deeply enough to be trusted with the choice. The framework is the path to earning that trust.

In Closing: The Care Compound

The reality is that speed, shortcuts, and margin often take precedence over lasting relationships and great products. And there’s a feedback loop: the more employees feel like a number on a spreadsheet, the harder it is for them to care about the customer on the other end. Apathy compounds. It moves from the boardroom to the front line to the customer and back again.

But the reverse is also true. Care compounds, too. Showing a little of it to everyone around you and in the work you do doesn’t just improve the product; it changes the environment. And that might be the most unreasonable thing of all: that something so simple is so rare.

Hi!

It’s Hari. I’m sending this from Japan! Any recommendations? Please comment away!

First, thank you for going along this journey. I deeply appreciate it. We have grown together, beginning from zero:

Many newsletters focus on selling you an AI-generated course, pushing you through an email funnel, or using clickbait (emotionally charged) headlines. Mental Mosaic gives you lifelong tools to navigate day-to-day problems at work and even in life. Each letter is thoroughly researched and carefully considered, drawing on decades of experience.

If someone is trying to build something or increase their influence in an organization, please share this with them.

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On Space:

Spaced Repetition helps you recall concepts better.

Instead of cramming, you revisit an idea just as you’re about to forget it.
Each return strengthens the neural trace, making recall faster and more durable.

The timing matters more than the effort.
Short exposures, spaced over time, beat long sessions done once.

Learning isn’t built by intensity.
It’s built by return.

In the spirit of that, I’m sharing the key concepts of three of our most popular newsletters:

1. The Mathematics of Courage

2. Your Amygdala Is Running the Meeting

   

3. The Edit

Why mess with an Icon?

In a 2017 Harvard lecture, he revealed his core method:

“I was only interested in restraining myself and only editing it 3 percent.”

Favorite Reader Comments:

Two Recommendations:

1. Acquired: History of Rolex

2. How could we not? High Agency

Thank you.

To many more,

Hari

Six people at the same party. Six completely different versions of what happened.

Not fuzzy details—major plot points. Who said what. Who flirted with whom? What the room felt like.

All six were telling the truth.

This wasn’t a mystery thriller. It was Sarah Polley’s documentary Stories We Tell. What began as a search for her biological father turned into something more unsettling: proof that multiple honest versions of the same truth can coexist and contradict.

They always joked that Sarah didn’t look like her dad. Her parents weren’t getting along before she was born. Her mother took an acting job and became the belle of the party circuit. Sarah arrived shortly after. Her mother always insisted Sarah was her father’s daughter.

Years later, Sarah made the film tracing her biological father. But what lingered wasn’t the paternity mystery. It was how memory actually works.

We treat memory like a camera roll. It isn’t. It’s a living document—edited by emotion, identity, and repetition.

Conflict doesn’t always come from lies. Sometimes it comes from two people telling the truth—and meaning different things by it.

The Framework

For leaders, the harder question isn’t who’s lying. It’s about deciding when information arrives secondhand, filtered through people with incentives, fear, ego, and reputational risk.

Map the Emotion

We were underwriting a deal where two partners were locked in a bitter dispute over a past project. The numbers worked. Structure was sound.

Then one executive said the quiet part out loud: “The real risk here is the emotion.”

Ego. Revenge. Loss aversion. Two people, each convinced they were wronged. No model captures that.

Ask Five Whys: Without Stopping at the Flattering Answer

Taiichi Ohno popularized the practice of asking “why” five times. The insight isn’t persistence but resisting the urge to stop when the answer protects your ego.

“I missed the deadline because the other team dropped the ball.” True. And incomplete.

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Decide What “Enough Truth” Looks Like

A DNA test might get you to 99.9%. Remarkable—and still not absolute.

Most business decisions don’t even get close.

You won’t know if the regulation will shift. If a supplier fails. If a key person quits six months in.

So the job isn’t the perfect truth. It’s decision-grade truth.

The Fact-Checking Illusion

The New Yorker rigorously fact-checks names, dates, and quotes—and still receives letters when stories feel wrong. Because truth isn’t just factual. It’s psychological: framing, omission, motive.

We think truth is something you uncover. In reality, it’s something you triangulate.

Facts don’t fail us. Stories do—because stories demand coherence, and life refuses to cooperate.

Truth Triage is how you lead anyway.

Humanity was rooting for the computer to fail. Go was ours—too intuitive, too human for cold logic to master.

Invented around 2000 B.C. in China, Go is a two-player game in which identical stones are placed alternately on a grid to surround empty spaces. The winner controls more territory than their opponent. Simple rules. Infinite complexity.

Chess offers roughly 35 legal moves per turn and about 10^120 possible games. Go offers closer to 250 legal moves and an estimated 10^360 permutations, an exploding possibility space where advantages often reveal themselves 50 moves into the future. With no material hierarchy (every stone equal), evaluation becomes fuzzy at best.

Chess had fallen to machines. Go remained.

Google DeepMind built AlphaGo, a neural supercomputer designed to do the impossible. After defeating top players across Europe, the machine finally met its match: Lee Sedol, a 9-dan professional, the equivalent of a chess grandmaster, except far rarer.

The match was set for March 2016. Five games. Best of five. The world watched.

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The Feedback Architecture

While the world waited to see whether humanity’s champion could hold the line, AlphaGo was doing something remarkable. It compressed years of learning into three weeks by reviewing and playing more than 30 million games, not against humans, but against itself.

AlphaGo didn’t win through raw computing power. It won by learning faster than any human could. The secret wasn’t speed. It was structured.

Its advantage came from tightly engineered feedback loops:

Simulate futures. Play thousands of possible move sequences forward. Check out our prior article on analyzing future outcomes.

Evaluate outcomes. Identify which paths led to winning positions and which didn’t.

Adjust the model. Reinforce patterns that worked. Weaken those that failed.

Repeat. Constantly. Relentlessly.

We can’t simulate millions of scenarios. But we can build the same feedback architecture, just at a human scale

Building Your Feedback Loop

Most organizations treat feedback as an annual event. Information moves slowly. Adjustments arrive late. By the time you realize something isn’t working, you’ve already committed six months to the wrong direction.

This pattern is repeated when sales are poor, efficiency is lacking, or customer complaints are increasing. It’s always a system failure and a feedback issue.

AlphaGo operated differently. Its feedback was continuous, not episodic. Learning compounded daily, not yearly.

The Audit That Wouldn’t Close

During my time as a bank regulator, I reviewed an audit log at a mid-sized institution. Minor issues (documentation gaps, policy violations, control weaknesses) had remained unresolved for over a year.

Management dismissed the findings as minor. The feedback signal was perfect, but it never reached the people who could act on it.

I expanded my review, examined the workpapers directly, and spoke with the Chief Auditor outside management’s presence. I was stress-testing the claim that “these are just minor issues.” If true, the documentation would be thin. The auditor is inexperienced. The conclusions are weak.

None of that was true.

The auditor was exceptional. The findings were serious and well supported. Management had convinced themselves otherwise because acknowledging the issues would require uncomfortable action.

I presented my conclusion to the board: the auditors were doing excellent work, but management was filtering it out.

The board rewired the system. Audit findings now flowed directly to the audit committee, unfiltered by management. The loop closed.

Months later, those same auditors uncovered embezzlement by senior bank officials.

The Four Principles

AlphaGo’s feedback architecture followed four steps: simulate futures, evaluate outcomes, adjust the model, repeat.

That audit followed the same pattern:

Create a clear signal. Auditors generated precise, actionable feedback. The failure came from suppression, not noise.

Play against yourself. I stress-tested management’s narrative before accepting it.

Close the loop. The board didn’t just acknowledge the findings. It changed how information flowed.

Feed results back. They didn’t fix one issue. They redesigned governance for every future case.

We can’t simulate millions of games. But we can build feedback loops that actually close.

Move 78

Lee Sedol lost the match 4–1. Thirty million games of self-play proved unbeatable.

But in Game 4, facing elimination, Sedol found something AlphaGo hadn’t seen in all those simulations. Move 78, a wedge play so creative, so unexpected, that AlphaGo paused for fifteen minutes and never recovered.

Sedol won the game.

One human move out of 280. One moment where intuition saw what data couldn’t.

Human creativity still matters, but only when paired with disciplined feedback. AlphaGo didn’t win because it was smarter than Sedol. It won because its intelligence was structured around tighter loops. It learned from more failures, adjusted faster, and closed the loop relentlessly.

That bank audit worked the same way. Management had judgment, experience, and creativity. But without listening to the feedback their own system was producing, none of it mattered.

The question isn’t whether you’re as smart as the machine. It’s whether your feedback loops are as tight.

Pick one decision you’re making this week. Before committing, ask:

• How will I know if this worked?

• When will I know?

• Who will tell me?

• What will I do with that information?

If you can’t answer all four, you don’t have a feedback loop. You have a guess.

Now map it: Where does signal get generated? Where does it flow? Who can act on it? Where does it break?

Find the break. That’s where you start.

If this can help someone, feel free to share:

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Rather think about when Christmas decorations come down. Focus your emails on main lede, why, ask, and go deeper.

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F1 is humans operating at the edge of physics: split-second decisions at 200+ mph where millimeters matter and mistakes are catastrophic. On race day, the driver is the visible decision-maker, but behind them sits a distributed brain: dozens of engineers monitoring telemetry, strategists calculating probabilistic outcomes, pit crews rehearsing 1.9-second tire changes.

The team radio is their shared nervous system: clipped, profane, decisive. When a driver ignores an instruction or a strategist miscalls a tire strategy, millions of dollars and championship points evaporate. F1 teams communicate as if every message costs something, because it does.

We communicate like attention is infinite, because we’ve never measured the cost of being unclear.

Years ago, I was in an executive meeting discussing a troubled transaction. The financial reporting was poor. Forecasts didn’t reconcile. A large order kept slipping, which executives believed could save the company. The discussion drifted into context: weak management, poor product-market fit, and whether a consultant could help. Hundreds of emails had likely preceded the meeting.

Then the CEO interrupted.

“How much did the company make in its best month this year?”

Someone answered quietly, “$3 million.”

“How much did they spend?”

Another voice, louder this time: “$5 million.”

The CEO paused. “Do we see the issue here? Shut it down.”

Veteran bankers had lost the plot. The obvious signal (cash burn exceeding revenue) was buried under commentary about management quality and external fixes. Those were secondary issues. The numbers already made the decision.

The Cost of Ambiguity

For entrepreneurs, this kind of clarity is rare. Unclear communication doesn’t just waste time—it loses the deal while you’re still typing. A rambling email to your most significant prospect signals operational confusion. The difference between “let’s move forward” and “let’s revisit next quarter” often lives in how crisply you frame the opportunity.

F1 teams engineered their communication around actual constraints: attention is scarce, decisions are time-sensitive, and ambiguity compounds into disaster. Most corporate communication violates these principles entirely. We bury the decision in paragraph five. We confuse length with thoroughness.

The best emails I’ve seen follow F1 radio discipline. Four components, in order:

The Framework

Main Lede – The decision, the number, the outcome. What matters most.

Why – The 2-3 sentences of context that justify the lede.

Ask – What you need from the reader. Specific, bounded, actionable.

Go Deeper – Optional detail for those who need it, clearly separated.

Here’s what this looks like in practice:

Weak version:

“Hi team, I wanted to give you an update on our Series A process. We’ve been in conversations with several firms over the past few weeks and have received a lot of positive feedback on our traction and vision. Sequoia has been particularly engaged, and we’ve had multiple meetings with the partners. They seem very excited about the space and our approach to solving the problem. We’re getting close to terms and wanted to loop you in on the next steps. There are a few other firms still in the mix, but Sequoia feels like the right partner given their portfolio and expertise. Let me know if you have any questions or concerns about moving forward. Happy to discuss timing and what we need from the board.”

Pit Radio version:

Main Lede: We’re close to signing the Series A term sheet with Sequoia. Valuation being negotiated.

Why: Three credible competitors emerged this week. Moving now gives us first mover advantage and we become the biggest player.

Ask: Need board signatures by Friday COB to meet their partnership meeting deadline.

Go Deeper: Full term sheet attached. Key terms: $15M raise, standard 1x liquidation preference, two board seats.

The first version took 124 words to avoid making a decision. The second took 68 words to make one, explain it, and move forward.

This isn’t about being curt. It’s about respecting that your reader is making dozens of decisions today, and every sentence that doesn’t advance the decision is actively costing them.

The Compounding Cost

In F1, a miscommunication during a pit stop costs 15 seconds and often the race. In business, it costs months.

The six-figure contract dies because your email buried the pricing in paragraph seven. The board meeting was derailed because your deck lacked a clear recommendation. The executive hire walks because your offer email reads like you’re still deciding.

Clear communicators project operational competence and from that power. They signal that you know what matters. You make it easy for others to say yes.

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Some problems reward velocity. Others demand the watchmaker’s hand.

No one pays $50,000 for a watch because it tells better time. A watchmaker obsesses over parts no customer will ever see. A screw the size of a comma, oiled with a droplet at the edge of visibility. Excess oil is arrogance. Too little is neglect.

After the 2008 crisis, I met the CEO of a successful community bank in New Jersey. Unlike his peers, he never touched mortgage-backed securities, despite years of pressure to do so.

“People a lot smarter than me told me it was bulletproof,” he remarked.

He continued, “My sister bought a house in an expensive part of Florida. Before she signed anything, I asked to see the mortgage paperwork.”

“I’ve been a banker for 30 years,” he told me. “I couldn’t make heads or tails of these documents. And when I couldn’t understand my sister’s mortgage, I knew no one understood a product made of millions of these mortgages.”

He didn’t say, “Let’s buy a little and see what happens.” He chose not to move at all.

In that moment, he was a watchmaker. He knew this was not a place for speed. It was a place where misunderstandings would quietly compound, long before they became visible. How do you tell the difference?

Break Loud vs. Drift Quietly

For years, Silicon Valley preached a single commandment: move fast and break things.

Some problems reward velocity: marketing tests, minor product updates, or trying a new way to reach new customers. Failure here teaches quickly. You move, learn, adjust. The cost of being wrong is measured in weeks and wounded pride.

Other problems demand the watchmaker’s hand: security standards, your people, your organization’s core architecture. Failure here compounds in darkness. By the time the gears lock, the damage is done.

Boeing spent decades as the gold standard of aerospace engineering. Then they made hundreds of small decisions that seemed reasonable in isolation: outsource more components, reduce engineer oversight, let schedule pressure override safety reviews.

No single decision killed 346 people in two 737 MAX crashes and wiped out $60 billion in Boeing's market value. But together, they created a drift-quiet failure that took years to compound and seconds to reveal.

The MCAS system failed because Boeing treated a core safety system like an iterative product feature. They moved fast on something that demanded the watchmaker’s hand. By the time the crashes happened, engineers who raised concerns had already been overruled. Pilots weren’t told the system existed.

DRIFT MAP

Start by classifying every system in your business with one question: If this fails, does it break loudly or drift quietly?

Once you know which is which, the protocols become obvious:

• For break-loud systems: ship early, iterate aggressively, treat reversibility as your advantage. Keep experiments short. Keep the blast radius small.

• For drift-quiet systems: require pre-mortems, mandate second reviews, never accept “temporary” hacks.

But classification alone isn’t enough. You need detectors, such as specific metrics that move first when something starts failing. If no one owns detection, drift is already underway. For example, in commercial lending, growing past due where customers don’t share their financials is often an early indicator of potential credit losses.

Speed is not courage. Slowness is not weakness. Wisdom is knowing which problems forgive mistakes, and which never do.

Move fast where failure teaches.
Move carefully where failure remembers.

Some errors correct themselves.
Others keep time.

Know the difference.

If this helped you think more clearly about speed and judgment, consider sharing it with someone who makes hard decisions.

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Trying to survive both gift-giving season and difficult conversations? Section three has the part that saves your sanity.

1. How Sony Lost the MP3 War: The Biology Behind Bad Decisions

   

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In his legendary black turtleneck, Steve Jobs walked onto the stage and redefined personal music:

“This amazing little device holds 1000 songs. And it goes right in my pocket,” said Jobs.

For Sony, it was a nightmare.

Until then, the Sony Walkman dominated personal music. However, a digital revolution was underway. Years before Apple rolled out the iPod, Sony had the tech for an MP3 player. But when the moment came, Sony froze. Executives saw MP3s as a threat and succumbed to the biology of fear.

In the annals of business, it was an unlikely turn. It began with an uncomfortable conversation years ago in Tokyo, where two of Sony’s most powerful factions stared each other down:

On one side: the innovative hardware division, makers of the Walkman, pushing for an early MP3 player.

On the other side: Sony Music executives, guarding the company’s tightly controlled music catalogue. With MP3s being pirated off Napster and LimeWire, they saw an existential threat to their profits. So why enable their use?

Two brilliant teams were fighting over territory, identity, and survival.

2. Fear of Difficult Conversations

For most of human history, survival depended on staying inside the tribe. Challenging the “peace” risked rejection.

The brain treats conflict like danger and launches a threat response:

In 200 milliseconds, emotion overrides logic. Stress hormones surge. Social pain lights up the same area of the brain as if you are getting hurt. Attachment and safety get activated.

Difficult conversations feel hard because we’re wired for survival, not confrontation.

They went with a digital Walkman that couldn’t play MP3s. Every track had to pass through proprietary software (i.e., wrapped in digital barbed wire to prevent piracy). Both teams saved face. Sony lost the future.

3. The BREATHE Framework for Difficult Conversations

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In the heat of the moment, you have to understand that a mix of ancient hardware, biology, and chemistry is influencing you. Business success requires navigating difficult conversations. The key is to have a learned set of behaviors that calm your nervous system so that the logical brain can pilot the conversation.

B – Before engaging
Take three slow breaths. Let your body calm down before you speak.

R – Ready check
Ask: “Are we both ready for this conversation?”
If not: “Let’s talk when we’re both ready—how about [timeframe]?”

E - Establish the frame
Open with explicit structure: “I’d like to talk about [specific incident]. My goal is for us to understand each other better and move forward. I’m hoping we can both feel heard and respected.” This creates psychological safety and shared purpose.

The key here is to drive a conclusion. Look at the end of this, I’d like to come up with a new process for xyz, or the big principles of the merger will be decided, or we walk away.

A – Acknowledge their perspective
“I understand you feel…”
“Thank you for telling me this.”
Validate, don’t necessarily agree.

T – Turn attacks into mirrors
When they get sharp, reflect:
“Is that how you’d want me to speak to you?”
Invite awareness instead of escalation.

H – Hear without defending
Listen to understand, not to reload your argument.

E – Exit with clarity
Summarize what you each heard and agreed to.
Thank them for staying in the conversation.

4. Mastery Under Pressure

Whenever you are building something, conflicts are inevitable. The best know how to rise above them. For example, Jamie Dimon, the “banker’s banker,” has weathered multiple financial crises. When the world is on fire, presidents and competitors alike lean on him for advice. That’s because he keeps a steady hand, even as others are spiraling.

Next time you feel the rush, BREATHE.

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Rather than wondering whether Zohran Mamdani and Donald Trump hugging it out will make Thanksgiving less political, here’s something more useful.
Skip to the Startup Formula halfway down — but first, a quick story about the moment my own company almost made it… and then died.

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The Near-Miss

My cofounder and I had spent three years developing promising new software when suddenly, our world was unraveling.

On the surface, we were thriving. We were deep into developing a software system that could determine whether a company was performing well (or poorly) by pulling financial data directly from its accounting software. No human intervention necessary. AI before it was cool.

A private equity firm was putting our software through the paces. We passed every test.

But behind the scenes, we were approaching a cliff. Cash and patience were critically low when our CTO, a programming wizard, dealt us a decisive blow: he was stepping down. Our fundraising calls hadn’t borne fruit, and, understandably, he couldn’t keep coding by himself.

The most crushing type of defeat is the near miss. That same week, we got the call any entrepreneur would dream of. But it was too late.

Cut to the firm partner with a 1000-watt smile, beaming at us over Zoom:

“We love the software. We want to deploy it across the entire firm. How soon can this happen?”

It was a moment of whiplash. Actually, we have to close up shop, we told him, but thank you for working with us. We made it a goodbye call. End of startup.

This was my third run at building a startup, and the most ambitious one to date. We were designing a fully functioning, enterprise-ready piece of software by bootstrapping, a Herculean task. It absorbed thousands of dollars and three years of burning the midnight oil.

Like many startups, we developed a solid idea but failed to build an organization capable of nurturing it.

I want to help you avoid this fate.

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The Startup Formula (Mistakes & Lessons)

I’m sharing the most common pitfalls that seem to derail startups (including mine) and how to overcome them. This is also, perhaps selfishly, a reminder to myself.

A few caveats: my definition of a startup is something you create from your mind, which doesn’t already exist. It’s most commonly associated with technology, but it can also refer to a new restaurant, product, or invention.

Before launching a startup, avoid the following mistakes:

1. Founding Team

Mistake:
We misaligned on risk and time. One founder wanted moonshots; others wanted stability. Uneven commitment slowly bred resentment.

Lesson:
A startup is a marriage. Align vision, risk tolerance, and workload early. The magic happens when a Jobs finds his Wozniak.

2. Relationships

Mistake:
Across three startups, we had no real Rolodex—so we leaned on cold emails and distant introductions. It slowed everything down.

Lesson:
Your first customers and investors come from who you can call—and who they can call. Map your network in three columns: customers, funding, and help. Call a few. Whoever shows up is your real starting line.

3. Cash

Mistake:
We assumed we’d “figure out the money later.” But you can’t test-fly a plane without fuel.

Lesson:
Be explicit about where capital will come from. Great startups raise (or earn) early. When uncertain, ask for a small check. It reveals who believes.

4. Market

Mistake:
We rushed into building our product before talking to real customers. Excitement replaced validation.

Lesson:
Let the market speak first. Talk to 20–50 people in and around the industry. Build only after you’ve heard enough truth.

The Gamble Behind Trader Joe’s

The two most critical phases for a startup are the launch and the suck.

The launch is easy. The late nights and sacrifices feel exciting. Then comes the long middle, or the suck: when the novelty fades and every day becomes a choice between investing another dollar into the company or covering your own life. This is where most founders break.

Heroic founders push through the suck.

Before Trader Joe’s was a cult favorite, it was Pronto Markets—small, unassuming, and run by a young Joe Coulombe who noticed something his parent company didn’t: people kept showing up.

When the company stepped away, Joe doubled down. He bought the chain, took on debt, and even asked his employees to buy shares. A gambler’s move, but not a blind one. He could feel the demand rising under his feet.

Owning Pronto gave him the freedom to reinvent it. In 1967, that leap became the first Trader Joe’s.

Big outcomes often start the same way: one person betting on a signal everyone else ignored.

When to Push On vs. Recalibrate

So how do you know when to push on and when to step back and recalibrate?

The key is customer validation: Are sales growing? Is the market pulling? How have you de-risked the business? The market’s signal—not your optimism—is the compass.

Too often, founders love their idea. But look for hard, tangible evidence: demand, funding, retention. Are customers clamoring for your product?

Let’s Build Together

Part of the motivation for writing this Substack is to connect with others and hear about their work. Do you have an idea you’re excited about? Do you want a more detailed checklist to test your project?

Leave a comment on what you’re building, what you aspire to develop, or what challenges seem to be cropping up, or email me at mental.mosaic88@gmail.com.

I’ll send you a much more detailed checklist.

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Rather, think about whether it is excessively early for Christmas Decorations: What if you could rebuild something from scratch—without knowing who you’d be inside it?

ACT I — The Visit

The town square still carried the bones of beauty—Greco-Roman arches catching the sun—but its spirit had thinned.
Shuttered shops. Boarded-up homes. Only two restaurants remain: one is fancy enough for a wedding, while the other serves defrosted pizza.

As a newly minted bank regulator, visiting forgotten towns was a rite of passage:
Fly into Pittsburgh, rent a car, and drive three hours toward the edge of Ohio.

The grandest building on Main Street was, of course, the bank—mahogany gleaming, stone immaculate, towering above the town. I remember turning to a coworker and saying, “No wonder everyone hates banks.”

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ACT II — The Pivot

The town had lived on coal.
When production fell—hit by tighter regulations and depleted seams—the economy suffered a collapse.
Businesses shuttered, families left, taxation revenues dwindled.

Most community banks either merged or went out of business.
This one did something rare: it adapted.

As fracking spread to rural America, the bank followed.
It opened branches near drilling sites, serving workers the big banks had abandoned.
Over time, it lent to energy firms, contractors, and the small businesses supporting them.

A coal-town lender became a regional energy bank.
The turnaround wasn’t sudden or flashy—it was steady, local, and pragmatic.
It stopped trying to rebuild what was lost and started serving what remained.

ACT III — The Philosophy

That kind of adaptation takes distance—the ability to see problems without nostalgia or bias.

Philosopher John Rawls called this the veil of ignorance:

Fairness emerges when we make decisions without knowing our personal stake in the outcome.

Imagine designing a system not as a banker, miner, or regulator—but as anyone who might live with its consequences.

The bank’s reinvention wasn’t just financial—it was philosophical. It began from first principles:

What still creates value here?
What’s fair?
What works now?

That mindset—removing identifiers and starting clean—is just as valuable for policy, business, and everyday work.

ACT IV — Your Turn

Rawls wrote for politics, but the veil applies everywhere.
Whether you’re running a team, writing policy, or navigating workplace politics, ask:

Can I decide as if I didn’t already know my role or advantage?

That’s the spirit behind this week’s experiment:

🧮 Budget Game

Imagine you’re responsible for balancing the federal budget—
but you don’t know who you’ll be in the society that results.
A CEO? A teacher? A retiree? A single parent?

When you draw the veil, fairness stops being ideological—it becomes about tradeoffs.
And you realize something deeper:

The veil doesn’t make the problem easier.
It makes it honest.

Takeaway

Before your next big decision—at work or in life—
Try writing it twice:
Once as yourself, and once as if you were the intern, customer, or neighbor affected by it.

That’s the veil in action.
That’s wisdom made practical.

Rather learn about the Louvre Heist: We often think greatness requires grand gestures- but what if brilliance hides in the 3% tweak, not the 97% we replace?

I. Virgil Abloh - Modern Alchemist

Bio (1980-2021): Architect, Kanye’s Album Covers, Creative Director Louis Vuitton

See-through Rimowa suitcase —don’t we all struggle to find where we packed it?

Virgil Abloh didn’t reinvent fashion — he remixed it:

• A see-through luggage bag.

• A luxury handbag held shut with a binder clip.

• Often, they were just a single word, like “TEMPORARY,” plastered across an IKEA wall clock’s face.

Each design looked familiar yet subtly off kilter, charged with irony and cultural commentary. Abloh called it:

“The gray area between black and white.”

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II. The 3 Percent

Why mess with an Icon?

In a 2017 Harvard lecture, he revealed his core method:

“I was only interested in restraining myself and only editing it 3 percent.”

For his Nike collaboration, he didn’t build new sneakers. He deconstructed icons — Air Jordans, Air Force 1s — then added small yet potent changes: plastic zip ties, quotation marks, exposed foam.

That minimal edit — just three percent — transformed ordinary into iconic. They sold out almost instantly.

III. The Blueprint

In case you weren’t sure

Abloh’s philosophy transcended design —his fingerprints were everywhere, from sneakers to wedding gowns. It’s also a blueprint to build a life.
When perfectionism freezes you or social media makes you feel perpetually behind, try Abloh’s approach: micro-edits, not massive overhauls.

In a world obsessed with reinvention, Abloh reminds us that iteration is underrated.

IV. Try Your Own 3 Percent

A few experiments to start:

• Instead of “I’ll run a marathon someday,” try a 5-minute jog today.

• Catch up with a long-lost friend.

• Hunt for an art piece to liven up your living room.

The familiar, when slightly altered, becomes art.
So does a life.

V. The Closing Question

Abloh’s genius wasn’t about doing everything.
It was about changing something — deliberately, playfully, 3 percent at a time.

In the spirit of Abloh, consider alchemizing your own life with micro-edits. Retain the familiar. Add a touch of novelty.

Rather listen to Life of a Show Girl: Risk isn’t math — it’s emotion measured in numbers. The goal isn’t to avoid volatility, but to choose the kind you can live with.

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The Restless Moment: What “In the Mood for Love” Teaches Us About Risk

Wong Kar-Wai’s tantalizingly beautiful film In the Mood for Love is a penetrating meditation on longing and restraint.

In one of its most charged scenes, we find the film’s two would-be lovers in a narrow corridor, their faces inches apart, their fates at a threshold:

“It is a restless moment,” the narrator says.
“She has kept her head lowered…to give him a chance to come closer. But he could not, for lack of courage.”

Kar-Wai’s tale of unconsummated love is often cited as a masterpiece. Perhaps it resonates so deeply because it conjures our own missed opportunities — that time we passed on a startup job for the perceived safety of a corporate position, or we put aside our dream of studying music to secure a career in finance.

Risk Isn’t Just for Bankers

By day, I underwrite loans to companies. That means I live in the world of risk analysis. For me, Kar-Wai’s mesmerizing film is also a visual portrayal of the unseen force that haunts every missed opportunity: our tense relationship with risk.

Knowing how to analyze risk is a life-changing skill, yet it’s rarely taught. It means knowing when to leap, when to wait, and how to think about the odds of success.

What few people realize is that the same tools Fortune 500 companies use to maximize profits can also guide everyday decisions — even those as personal as a romantic encounter.

On the surface, measuring risk sounds wonky and technical. But it’s actually more of an art — a constant dance with possibility and risk.

How to Think About Risk

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When it comes to the core concepts of risk analysis — probability and standard deviation — you don’t need complex formulas, just intuition.

Here’s how it works.

Whenever you face a complex decision, start by breaking it into two parts:

1. The likelihood it will succeed (probability)

2. The severity of the swings (standard deviation)

1. Probability — The Likelihood of Success

Let’s start with number one. Consider a few benchmarks:

• 75% → strong odds

• 50% → a coin flip

• 25% → weak odds

Going deeper, the trick is that you can’t simply ask “Will it work?” but rather, “What’s the cost of making it work — and is that cost worth it?”

Say you want to launch a startup. Landing your first customer is going to cost $50 k and months of sleepless nights. Is that worth it? It depends. If it sells for $55 k, most people would say no. But what about a 10 percent chance at $10 million? That’s interesting.

Here’s another rule of thumb: the costlier the pursuit of success, the higher your payout should be. That means calculating personal costs too. Missing dinner every night to get the business off the ground could mean missing out on seeing your son grow up. Are you okay with some regret?

2. Standard Deviation — How Wild Are the Swings?

This is where we consider standard deviation — a measure that tells us how volatile the prices, returns, or even just the expected benefits are.

We can usually break that down into three categories:

• Low Standard Deviation → Stable: Investing in treasury bills, parking your money in a savings account, holding a tenured job.

• Medium Standard Deviation → Manageable Swings: Investing in Apple stock, buying a home, switching jobs in the same field.

• High Standard Deviation → Wild Swings: Investing in crypto, opening a restaurant, moving to a new country for work.

The question to ask here is: Can you handle the swings?

If your startup loses $50 k, are you okay with that? What about $200 k? Can your family still make ends meet and buy a house while you build the startup?

Another way to ask this is:

“Am I prepared — emotionally and financially — to live through the volatility?”

When Risk Meets Reality

This isn’t just theory. I once saw it play out with the fantastic collapse of New York’s once rock-solid market for taxi medallions.

Because the cabbie system was tightly regulated, bankers had long assumed medallion prices would rise forever. From their perspective, this meant that taxi owners could always pay back their loans.

As medallion prices continued to rise, I began to have doubts. When I ran the numbers, I found that a cab would have to be in service 24 hours a day to make debt payments.

When I pointed this out to a banker, he waved it off:

“Easy — 12 hours for one cabbie, 12 for the other.”

What the banker missed was the standard deviation. Volatility was creeping in. Burned-out drivers faced enormous stress in trying to pay back loans, and new technology — Uber — was poised to capitalize on a lucrative market.

Before long, the medallion market collapsed.

Whether in our business or personal life, we can’t simply ask, “Will this work most of the time?” We also have to ask, “What happens if things swing against me?”

The Takeaway

💬 Pull-Quote:
“Risk isn’t about math — it’s about courage.”

Wong Kar-Wai’s film lingers on longing — but our own stories don’t have to.

The restless moment is always here.
The question is: should you leap?

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Let me keep Scrolling: We crave stories with heroes and villains—black-and-white certainty feels good, but it flattens people. Choose the grey: use the MRI (Most Respectable Interpretation) to swap judgment for curiosity and build better relationships.

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Cold Open

At fourteen, I had solved global trade. Or, I thought I had. I was suited up and representing a small African country at Model UN, the summit of overconfident teenagers cosplaying as world leaders to solve global crises.

My “Nobel” Plan

I delivered my trade proposal with the certainty of Adam Smith: Ford and General Motors can sell more cars if Americans pay a higher price to subsidize vehicles for poorer countries.

An obvious win-win: Detroit builds more cars, new markets open up, and poorer countries get affordable rides.

Now, where was my Nobel Prize?

The Gavel Mindset

Model UN, in theory, was about exchanging ideas on complex topics. But no one seemed interested in listening.

We were there to win. Claiming victory meant the all-coveted gavel—the ultimate prestige token for debate nerds.

It nurtured a black-and-white mindset: My view is good and yours is bad, so I don’t need to understand your perspective.

Sound familiar? It was an early precursor to today’s social feeds, where everyone wants a gavel, and collectively, we get nowhere.

The Turn: Embrace the Grey

As I’ve gotten older, I’ve realized the world is a messy palette of greys, and there’s no award for the winning argument, just more polarization.

To actually solve complex problems and build relationships, we have to be curious, not judgmental.

The MRI

An easy way to self-program for empathy is to use an MRI. It challenges us to ask: What’s the Most Respectable Interpretation?

• An entrepreneur keeps posting pictures of his house, car, and all the media attention he is getting. Maybe the person lost everything twice to build the business, and it’s finally successful.

• A manager emails you at 1 a.m. Maybe that’s when their colicky newborn finally fell asleep.

Every social interaction carries an unknown backstory. Choosing the most charitable one builds connection, not division.

A line to keep

The Ask: If this helped, forward to one friend who loves a good debate.

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The bill? Just 2–3% of the sticker price.

Why it matters:
Building rockets wasn’t inherently expensive. Throwing them out was.
It’s the same logic that makes air travel affordable. A Boeing 737 can fly thousands of times. A single-use jet would make NY–LA cost as much as a yacht.

The principle:
To spot a disruption, reduce the “impossible” to its parts.

• Henry Ford split car manufacturing into 84 steps, cutting 12-hour builds down to 90 minutes.

• The mass auto market was born.

  

Your move this week:
Take a problem that feels overwhelming. Break it into smaller units: inputs, steps, or costs. Where’s the waste? Where’s the leverage?

Bottom line: Myths intimidate; maps don’t—chart your solution step by step.

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We’re drowning in content. You don’t need more noise — you need a signal.

I’d like to share a project I’ve been working on: Mental Mosaic.

It’s my twice-monthly note—distilling ideas from business, psychology, and lived experience into something you can read in under three minutes.

Each letter will be on a different theme:

• Tiny habit — slight shift, big payoff

• Cognitive error — bias in the wild

• Mental engine — how high performers think

I’m starting with a small circle of people whose input I have trusted over the years. I’d love for you to join and share your thoughts.

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See you in your inbox,
Hari