Go is a 4,000-year-old Chinese game with a wide following in the Far East. Aficionados love the game for its combination of strategy, tactics, and creativity. Unlike Chess, which can be deconstructed into a fairly limited number of moves at any point in a game, Go offers literally millions of possible moves—giving rise to the adage, “If Chess is a battle, Go is a war.”
While skill and acumen are rewarded in Chess, in Go it is the creative, the artist, who finds success. Tellingly, most professional Go players begin their careers as young children—usually no more than five years old—and are revered as grand masters in their early twenties. Few attend university; instead, they spend their developmental years studying the move-by-move records of past games played by the masters, seeking the spirit that drives the artist.
Instead of working on canvas, Go players work on a board carved from blocks of wood, with the best boards costing tens of thousands of dollars and carved from the carcass of a 1,000-year-old tree. Instead of paint and brushes, the Go player’s tools are stones made of polished black slate and white clam shells.
THE MOVING HORSE
There are a multitude of approaches to gameplay. One school sees the Go board as a continent surrounded by coasts. As the ultimate object of the game is to surround territory, capturing the coasts before heading inland pays the greatest dividends, just as it has in the real world.
Another approach views the static placement of pieces on the board as collectively creating the fluidity of motion. This approach, sometimes referred to as the Moving Horse, encourages the student to pay attention to the larger board and to flow toward opportunity and, if necessary, run from risks.
I should mention an additional aspect of gameplay: Once a piece is played on the board, it remains fixed in place—unless it is captured.
The capture takes place in only one way—the removal of all “liberties.” These are the horizontal or vertical intersections leading directly from a single stone, or groups of stones, on the board.
Imagine a stone placed in the intersection of a simple “+” sign of the sort you might use in basic addition. If the four points at the end of the + sign are occupied by enemy stones, your piece is dead and is removed from the board. In the illustration here, you can see the black stone surrounded by three white stones. If white plays in the last remaining intersection, the black stone is captured and removed.
The same holds true if you can surround a group of stones—and I have seen players lose dozens of pieces in a single fight by failing to create a double-eye.
In the game of Go, there is essentially one reliable technique to avoid being surrounded and losing all of your liberties. It requires creating a “double-eye.” This refers to a formation where you have two connected groupings of stones with each surrounding an empty intersection (see illustration).
It is impervious to assault because the enemy can’t capture both of the empty intersections in a single move. Thus, dropping your stone in just one of the two intersections would instantly deprive your stone of all its liberties, and that would be suicide.
There are other, more nuanced ways of preventing a group of stones from being captured, including a formation that prevents either side from moving in for a capture without exposing their own stones to a capture first. Call it mutually assured destruction. For the most part, however, if you are going to play Go successfully, understanding the concept of double-eyes (and blocking your opponent from forming double-eyes) is essential.
Not only does a double-eye formation protect your stones from capture, it provides you with an unassailable foundation that allows you to project power into other parts of the board.
Go and the Art of Living Well
There is much more to the game of Go than I could possibly begin to relate here. For the purpose of this missive, I focus only on the Moving Horse and the Double-Eye. In my view, these are not only key to succeeding in Go, but to succeeding in life.
Allow me to elaborate.
Over the course of their lives, many and even most people become very insular in their world-view. This is understandable given the nature of the human condition.
Each morning, we rise with some idea of how the day will unfold. We expect to have a cup of coffee, a spot of breakfast, and then engage in an activity we believe will be productive and so help us provide for ourselves and, as appropriate, our families.
We smile at our bosses, try to do our work well, and think ahead to activities planned for the upcoming weekend or holiday. Within a fair bit of latitude, this pretty well describes the nature of human action since humans first started acting.
But is this living well? Is there any poetry in this kind of existence? For most, I think the answer is obvious.
So, where does Go come in? To begin, it is helpful to place human concerns into larger groupings, such as you might a group of stones on a Go board. While you might identify these differently, my version would look like this:
• Financial security. Without some semblance of financial security, it is hard to live a fulfilled life.
• Sense of well-being. At one point or another in everyone’s life, there is a moment of near-perfect peace. A moment when we know we are doing exactly what we should be doing at that moment in time. Living a life that resonates with that sense of well-being is, in my view, a goal worth pursuing.
Of course, within those groupings—especially the latter—there are many inputs. For example, many people desire a happy family life and will benefit from engaging in healthful and interesting activities, but those are all connected to the broader sense of well-being.
In terms of financial security, both the Moving Horse and Double-Eyes have relevance. In the case of the former, too few people take the time to step back from their finances to get a true sense of whether their money is running toward opportunity or, if advisable, needs to be running from risk.
If your net worth is stagnating as you are growing closer to an age where you have to live off your capital, you need to take action to avoid finding yourself caged in by your circumstances.
To be successful in Go and, I would contend, real life, you must open your mind to the bigger picture. When a threat to your significant assets appears on one part of the board, you can choose to attack or, if you are not in a sufficiently strong position to do so, immediately begin to move toward open territory.
Depending on the nature of the threat, this is not always possible in small measures, i.e., one stone safely connecting to the next in turn until you are beyond the threat (because the attacker can then easily head you off). Therefore, the only way to save yourself may be to take a risk and spread your stones further apart, with the intention of connecting to the main body later.
Returning to the real world, one could observe the bigger picture of widespread central bank fiat currency creation and come to the conclusion that doing nothing today could lead to financial devastation tomorrow.
As there is nothing you can do to stop the currency degradation—a chastising letter to Janet Yellen would fall on deaf ears and might earn you a visit from Homeland Security—you might begin to mitigate the threat by making cautious investments in precious metals or quality precious-metals-related stocks. You do so fully expecting that the move won’t pay off overnight, but also that it will give you a far better chance to protect your core assets in the long term.
Of course, this also works in reverse. Buying precious metals with the attitude that they will always go up is naïve. The reality is that precious metals are just another asset class and will rise and fall based on broader considerations. Here’s a tip: When precious metals soar and you feel euphoric about your investments in the sector, begin moving toward security by cashing in.
The point is that when it comes to financial security, it is crucial to be fluid in your analysis. That doesn’t mean jumping from one sector and one investment to another. Rather, it means you must understand that, like a game board, the macroeconomic picture constantly changes. Thus, while interest rates may have been kept at historic lows for far longer than a rational person would expect, they are not going to stay there indefinitely, no matter what your broker or the reigning Fed chairperson tells you.
How might you apply the concept of the Moving Horse to your personal well-being?
Again, it can be as simple as stepping back from your routine and seriously assessing where your life is headed. Do you perform healthful activities? Are your family interactions on a positive track? Do you find time to pursue activities that make you feel alive? Make that ALIVE!
Or are you stuck in a deep rut, marking time until someone throws dirt on your rut and it becomes your grave?
To the extent you discover stagnation, get moving. Take a walk, or sell your house and move to the place you’ve always dreamed of. If your marriage is broken, and you know in your heart of hearts it’s not going to get fixed, move on. Regardless of the immediate consequences, I can think of little worse than living in a loveless relationship of the sort one encounters all too frequently.
If you are not in touch with where your life track is leading you and fail to do what’s necessary to steer it in a positive direction, you’ll likely wake up one morning and realize you are too old to do anything but muddle by until the dirt starts falling.
Making Your Own Double-Eyes
The technique of creating double-eyes is, I think, one of the most important concepts in life as well as in Go.
In terms of financial security, the analogy applies to securing your financial well-being in such a way that it is all but unassailable.
In my opinion, the key to creating “double-eyes” for your net worth is to strategically diversify. At the broad foundation of your investment pyramid, I would cement in international diversification. And by that I don’t mean buying an international mutual fund, but rather physically having assets in different (safe) political jurisdictions.
Failing to do so puts you at the very real risk of having a government—or a lawyer using failings in the legal system as a weapon—simply freeze your assets, setting the stage for a complete asset stripping. In a similar vein, taking the trouble to get a second passport could prove very useful.
Second in importance is to hire professional advisors who specialize in different asset classes. I say that because I have seen far too many amateur investors self-manage their investments into penury.
Typically, this occurs by adopting a strong bias for one asset class or another, then “betting” a large chunk of their net worth accordingly.
I can’t count the number of times I have had investors in the precious metals sector tell me they were “all in” on precious metals and precious metals stocks. That is akin to placing your stones in a linear fashion that fails to create a double-eye. By the time you recognize that your enemy—in this case, other market players who make money by exploiting your bias—is degrading your financial liberties, it may be too late to create a resilient structure.
Of course, likewise, you don’t want to be “all in” on stocks and bonds, even though that would have been a good move since 2009. In fact, especially because that was the right move since then. I am not saying you need to abandon these sectors out of fear they’ll turn down, just that you’d be foolish not to employ a competent manager, either through a low-cost fund or, if you have the assets, by working directly with a manager who understands the tactics needed to hedge risks.
And don’t forget real estate. While it is, for most, an expense, not an asset, purchased at the right price and for the right reasons (diversification, long-term income), it can be a great way of creating the additional liberties you need to achieve financial security.
The bottom line on creating double-eyes for your finances, in my thinking, is that you either need to put in the hundreds of hours of study required to become a competent investor, or you need to hire one to help you meet your objectives. In either case, be sure to diversify between asset classes and geopolitically.
What about double-eyes and your sense of well-being? That’s an easy one.
Numerous credible studies show that people who feel a connection to other people and who set goals for themselves just above their capabilities and then strive to achieve those goals will feel most positive and energetic about their lives.
Over the years, I have naturally gravitated toward activities that energize me mentally and physically. This is specifically why I live where I do, in Cafayate, Argentina. Here we have the sense of community lacking in so many places, topped off with the daily sense of adventure that comes from living in a culture other than that you grew up in.
Also, I took up the game of golf late in life, and while it may seem mundane and even boring to many (most?), it embodies the concept of setting a goal just above your capabilities and then accomplishing it. Even jaded Tiger Woods jumps around fist pumping after making a clutch 30-foot putt.
Long-distance horseback riding has also become a passion, an activity requiring a fair amount of planning followed by the physical challenge of traveling for days in the saddle as you make your way toward a distant destination. Around just about every corner is a new view, a new experience and a new challenge that, overcome, makes you feel alive.
Set your life up right, and your happiness won’t rely on a single liberty, because your world will be full of liberties.
Each of us innately knows what fulfills us, but only a handful actually step out of their comfort zones to live the life they want, versus the life they are expected to live.
Don’t be one of those people.
For those of you wanting to learn more about GO, you find a number of resources and can watch replays of GO games played by masters at http://www.gokgs.com/.
Also, I have downloaded the free SmartGo app for my IPad. In addition to allowing you to play against a computer, the app comes with a link to interactive GO books that will be invaluable in pursuing your studies.
Until next time.
By David Galland