Zero Cost, Pure Upside

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One of the (few) calculations for my Business and Entrepreneurship class is customer acquisition cost. I’m a fan.

Rewriting the text for the upcoming year forced me to reemphasize and reiterate the value of a low CAC. Especially in the world of social media marketing and influencer marketing where CAC is sometimes zero. It’s an incredibly powerful idea.

But anything zero or low coast can be. Especially when part of an equation that divides (zero by many) or one that multiples many by a low cost (such as almost zero).

Talking with Chicago Fed Chair, Tyler Cowen asked about this very thing.

COWEN: What would be an example of something with a marginal cost of zero?

GOOLSBEE: [laughs] Well, I don’t want to reveal anything about our operations and get myself in trouble about the Federal Reserve operations. If you look at marginal cost of zero things, opening meetings to include others and having folks work together, sharing of information can often have very low cost — if not literally zero — and strong benefits.

Maybe this is the engine of alchemy. Find something that costs nothing (or very very very little) and do more of that. If it’s valuable (or very very very valuable) do a lot more of that.

Related: Free Things.

Quantitative Parenting

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Parenting two teenagers is difficult. Most of it comes down to remembering two things.

The first, my wife said this too shall pass. From the very beginning that has been good advice.

The second, when I was a boy of 14 my father was so stupid I could barely stand him. But when I got to be 21, I was astonished at how much the old man had learned. That’s from Mark Twain. Maybe.

There might be a third to the list.

“Quantitative stuff can survive doing some horrifically stupid things in isolation. If 53 percent of the time increasing is a good word, then 47 percent of the time you were stupid. Turns out natural language processing or NLP, if we want to sound like the cool kids, that is taking that same data and training a ML model to say what predicts and what doesn’t predict.”

From Money Stuff: The Podcast: Cliff Asness, Jun 20, 2025

And parenting is kind of like that! Everyday Asness makes bets and everyday we get to be with our kids. If we can just be mostly right, things work out just fine. Or at least they have for Cliff.

Michael’s Monday Motivation

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“You exist at home and everything is nice and comfortable, and stress has come in, but they’re in the form of emails and deadlines and things just get predictable. Go out into a place that is totally unfamiliar, do something that’s going to be challenging to you, go with the wind, you will find things that will really enhance your life, that will make you feel, as Joseph Campbell put it, the rapture of being alive”

The rapture of being alive.

From Huberman Lab: How to Grow From Doing Hard Things | Michael Easter, Jun 16, 2025

“Why?” to be Happy.

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This book, opens Bob Moesta and Michal Horn, does not tackle getting into schools or how to rank different schools based on their features.

“Instead, if you are considering getting more education, this book will help you answer a more foundational question first. That question is why?”

Asking “Why” is a good way to be happier.

In the post from last week, we highlighted Kris’s comments about framing housing. In that same post he writes, “Neither of us wants to find ourselves servicing interest payments to some mimetic trends.”

Why do we want this house? The answer better not be The Joneses.

Moesta’s and Horn’s book Choosing College gives a framework for answering that question. “Why?” is a tough question. It’s hard to answer with a blank slate. But the authors suggest there are five Jobs to be done by going to college, and figuring out the progress shifts from the blank canvas to a paint by numbers masterpiece.

“Why?” to be happy. And when needed a book like this to help with the “How?”.

Framing Housing

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Kris is buying a house. This is how he and his wife think about it:

Personal thinking: whether we rent or own, we ask ourselves “At what level do we want to consume housing at?”. Even if we can afford more, we try to be ruthless about what is a must-have vs nice-to-have and not let the nice-to-have creep out like a wolf spider hatching. Neither of us wants to find ourselves servicing interest payments to some mimetic trend. The cost is not just denominated in dollars but in utils of resilience and optionality which are key to peace of mind and lower stress.

At what level do we consume housing?

Great line.

Good framing asks a different question. It’s the same information, but a new view changes the image.

This frames views versus vacations, countertops versus career changes, and intentions and time.

How shiny is your noise?

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How shiny is your noise? How much does it glitter? How bright are the sparkles?

Does your noise ring like a bell? Does it sing brightly?

It’s not that noise. That other noise is dreary and harsh. It’s easy to note, notice, and avoid.

But that light tune? Our daily bread. Yes, with peaks and valleys but present thru the seasons.

It’s a trickster.

Our big beautiful bright noise. The one that sparkles, glitters, and shines. The lovely taste. The perk and pleasure. It tricks us.

It tricks us to think it’s a signal. It’s not – it’s just shiny.

There are two types of noise.

There’s the loud, brash, refreshed but not refreshing version. Like other obvious ills, easy to steer clear. But it’s the other noise that gets us. The other noise won’t tell you the truth but the truth is: it’s what you know that ain’t so. It’s noise. It doesn’t look like “noise”, it doesn’t sound like noise (it goes by names like “information”), but noise it is.

Assemble the forces. Garrison the powers. It is this noise we must block. This noise is insidious.

My noise sings. My noise is a ringing bell. But it’s noise – when all I want is signal.

They’re just Puppies

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All dogs wanted to be good dogs, no matter how unpromising they seemed. You just had to help them find a way. – The Old Man

There were frustrations when I returned to the classroom. Pesky persistent complainers. Foot draggers. Sleepers. Phone concealers. Make up concealers. C’mon, we’re in this together.

But then, after threatened and assigned detentions. After exhausted days. After hallway gripes. I realized, they’re just puppies.

People are just like puppies. Both have basic states of operation given their genetics, rules of physics, body chemistry and so on. Then, they both learn rules.

Puppies are taught not to pee in the house. Puppies are taught to walk on a leash. Puppies are taught to socialize. We don’t get mad at puppies for being puppies – we once had a puppy that only chewed up the right shoe. ¯\_(ツ)_/¯ 

Everything my students did was learned – successfully!

Complaining got results. Procrastination worked. Sleep was fine.

Life got a lot better when I thought about students as puppies.

Don’t Shoot the Dog! It takes time, persistence, and work to train puppies. Oh, and it’s fun. Puppies are happy to learn things and it feels good to teach them. Just like students. Just like all of us.

They’re just puppies.

The 9th Best College Town

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In his review of College Towns, Ray Delahanty (aka CityNerd) combines the walk, bike, and transport scores along with census data to score college towns.

Places score well (highly) on good urbanism, design, walkability, pedestrian streets and so on.

Corvallis Oregon ranks ninth, thanks to high bike use based on census data.

But, “it’s a little puzzling because the bike infrastructure isn’t exactly world class which goes to show how important culture and habit are for transportation choices“.

There’s a beauty to good design. We love design. It’s satisfying. It feels like we’re doing something.

But it’s not the root level.

Design is superficial. It’s shines. There’s polish.

Done well, design relies on points of friction, human needs, and feelings of belonging (like identity). Design is on culture and habit. Design must align with basic issues.

Positive Feedback Loops

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“But today I think about it as my mission in life is to get as many people as possible into positive feedback loops,” Graham Duncan told Tim Ferriss.

It’s why he spends so much time interviewing, talking with, and hanging out with people. “So I like getting the design right up front…I don’t wanna put something into somebody. I wanna have them do the thing that they wanna do anyway.”

Or as someone else said recently: don’t be trying to run up a down escalator.

One joy of YouTube is the rabbit hole. Find a niche and let the algorithm pump your feed full of whatever randomness.

One of my trips was the Toyota Sienna. One reviewer noted: it just doesn’t fight you. It’s not the top categorically – but there are no weaknesses. It’s a “floor-raiser”.

Positive feedback loops. Running up a down escalator. It just doesn’t fight you.

Alignment matters. It doesn’t make the knots less tangled but it makes untying them a lot easier.

How to Talk About Money with Your Rich Friends

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We all have rich friends. The richest person you know, knows someone richer.

I meant to go running one Sunday but as soon as leaving the driveway I saw Brian and Rachel – two neighbors I hadn’t seen recently. Instead, I walked with them.

Brian and Rachel are rich friends. Their house is bigger and in a nicer section of the neighborhood. They drive a Mercedes, I have a Toyota Sienna. They eat at restaurants I’ve never heard of. They take day trips – via plane – to see their son in Philadelphia. They donate enough to the Orlando arts their name is in the program and they get valet parking. They’re richer than me.

I’ve got another friend not as rich as me. Before I talk about him, let’s define rich.

One of my high school students lives in our neighborhood – the regular big and decent part like me. He said I was rich. “You’re right” I replied, “And here’s how you can tell”.

Anyone who owns any piece of exercise equipment is rich. They have enough money and space to buy extra things and enough energy (or aspirations of) to work out for whatever reason. Non-concern about basic things like food and shelter comes when you’re rich. I have a bike. My student has a rower. We’re rich.

My not-as-rich friend Bobby (a different one) likes to talk about how expensive things are. Travel is expensive. Our HOA is expensive. Vehicles and food and kids are expensive. Listening to him costs me energy.

But our conversations aren’t about money. Life isn’t about money. It’s not even really about the things money leads to.

It’s not the dinner, it’s the company.

It’s not the hoa, it’s the safety of family and proximity of friends.

It’s not the place tickets, it’s seeing your Ohio cousins once a summer.

That’s what Bobby misses and what Rachel and Brian get.

When I talk to my rich friends I listen for that: How do they love their peoples? When I talk to my rich friends that’s what I say: Here’s how I love my peoples.