2023.9 The Black Swan Edition

Because business is personal. This newsletter is dedicated to your own alignment journey.

“It happened before, and will happen again. It’s only a matter of when.” When this is your favorite line from your favorite 90’s action movie, you know that says something about you.

Hi ! 👋

You may have heard the recent news regarding the collapse of Silicon Valley Bank. And if this has directly affected you like it has some of the folks in my close circle, you have my deep compassion. This newsletter wasn’t something I planned on writing until I started receiving calls from these folks. As they were trying to mitigate the fallout across their companies yesterday, something occurred to me:

• We exist in a world where the money we deposit into a bank for safekeeping is not actually safe. And somehow, we find this lack of safety acceptable.

• This is why, after October 25th, 1929, my grandmother Ann stored her money in the freezer instead. I found it there when I was searching for ice cream one day.

  • (For folks like my grandmother, we put a “safeguard” in place, insuring up to $250,000.)

• Nevertheless, we exist in a world where it’s acceptable for a bank to lose its depositors’ money that was entirely placed there for safekeeping.

• When I stepped back from my education in finance and economics, one word came to mind: What?!

Now let’s be clear, placing your money in the freezer has it’s risks too. I could’ve taken it when I took out the ice cream. So while we deserve better from our banks, the world we live in has many systems that we think are safe but actually aren’t.

I’ve written about how safety is actually something that you can learn to own yourself internally — instead of externally through proxies such as a bank account, a job, a relationship, health insurance, etc.

Having your safety come from within & expand outwards increases your alignment with yourself. Letting go of attachments to things external to you as proxies for safety, dignity, respect, validation, worthiness, love, etc increases connection with yourself.

And deeply connected people do not neglect or harm themselves or others intentionally. This is why I write these newsletters: to increase connection through the practice of cultivating alignment. It is a practice that is grounded in daily living (personally and professionally) through intentional action. And intentional action is something we choose.

Recognizing your full capacity to choose, full capacity to act, is a big step to owning your safety.

Why? Trauma can be thought of as the removal of choice without your consent. So feeling safe goes hand in hand with recognizing your full capacity of choice in every facet of your life.

So what intentional actions, what choices, can you do to internalize more of your safety when you depend on things external to you for shelter, healthcare, food, and other basic necessities — especially in a world of disconnection and fallible systems?

This is how I approach it:

The biggest losses usually come from “tail risk”. Tail risk is the risk of an event that is unlikely to occur but would have significant negative consequences if it did happen. Think of extreme events, the “black swan” events that are rare, sometimes inconceivable, but have a major impact if they happen.

I own more of my safety internally by avoiding or mitigating negative black swan events. I do this routinely through asking myself the following question. It is the same question I ask when working with leaders and teams navigating risk when making big decisions & strategic moves.

If everything went sideways right now, what is your “value at risk”? What is the maximum you stand to lose, where are you most exposed?

Now you might have heard of the concept of "value at risk". It's a term commonly used in finance, but I've found it to be applicable to our personal lives as well. Essentially, it involves asking ourselves the question, "What is the most I stand to lose in this moment if things went sideways?"

By identifying our biggest negative risks, we can make intentional choices that mitigate or avoid those risks.

What this looks like: Follow the trail of “what ifs” regarding your exposure. Explore the chain reaction of consequences. Name your assumptions. Play the what-if game again and explore what happens when those assumptions unravel. Look at your cost/benefit. If in the unlikely event it doesn’t end well, and there are ripple-effect negative consequences, consult your discernment (beyond data) to determine your approach. Can you avoid this negative risk completely by choosing another action? If you cannot avoid it completely, can you mitigate it?

It all boils down to recognition of your capacity to choose and acting intentionally.

What this looks like in practice:

Before I started INLIGN years ago, I was considering resigning from the Federal Government to start my company. I decided this is what called to me as my next move. I informed my team, shared a transition plan, and emailed my official letter of resignation to HR.

Throughout this time, there were growing concerns of a government shutdown. I had lived through that before. People employed by the Federal Government (and contractors) are literally not allowed to work in most cases. It is technically illegal to work unless your position is considered essential. Even then, so much work lands these essential positions when others are offline that things become quite chaotic behind the scenes.

On every level imaginable, it isn’t pretty. Luckily, even when the government may shut down, usually Congress comes together & avoids the shutdown — or it only lasts the weekend, or at most a week. There have been a few cases of a longer lasting shutdown but it is *rare*.

*Rare*

By now, you know I have a heightened interest in thinking about black swan events. So when I think about things that are rare, I tend to go down rabbit holes — to own more of my safety by making intentional choices. Plus it is dark comedic fun.

“What if there’s a shutdown? What if it lasts the weekend? What if it goes on into the next week? What if it goes for a month? What about longer? How does that affect my paperwork? How does that affect my health insurance? I’ve had multiple spine fusions — I refuse to be without health insurance if something were to happen. What about my other benefits?” Black swan questions. Follow the trail.

Well, the day after I submitted my letter of resignation, there became more serious rumblings of a shutdown. Those questions were suddenly not just dark comedic relief. Nor were they big red flags to most people. That’s what a black swan event is: a rare event with major impact if it does, in fact, happen.

Most figured the shutdown, if it happened, would be resolved over the weekend. If not that, the next week.

So the day after I submitted my letter of resignation, I chose to rescind it. And I stuck to my guns. At least one senior leader was disturbed by my decision. They didn’t see what I saw. Until, when the shut down ended 35 days later and they said to me, “How did you know that was going to happen? I know people who lost access to health care during this time. This was serious. I thought you were gaming the system. I’m sorry I thought that.” I said, “I didn’t know it was going to happen. I just knew that if it did, I could lose access to my health insurance and that is a hard “no” for me. I will make sure I avoid putting myself in that situation as much as possible.” I figured with this choice, the most I stand to lose is the opportunity cost of not being in business quite yet — and the respect from that senior leader. But when you own your own respect, having *everyone* think highly of you isn’t something that’s driving your actions. You drive them.

Instead, I was respected more for carving my own path, assessing the tail risks, and being strategic. Being seen in a positive light when the dust settled was something I wasn’t expecting. I knew “un-resigning” wasn’t going to necessarily going to over well. I also knew that owning my own safety mattered more than what others thought.

Short version: When we decide we matter and that the collective matters we will act accordingly. You cannot do this without owning your safety more. And you can’t own your own safety more without recognizing your full capacity to choose. And choice is a big deal when we live in a world of potential black swan events.

I already hear some of you playing the shoulda coulda woulda game. Choose not to. That game is the worst 😣. Whatever got you here will help get you further. Have compassion for yourself and the choices you’ve made. I wrote this edition as an approach to practicing alignment with yourself through intentional choices for better outcomes regarding possible black swan events. So use your discernment, go forth, and prosper. 🖖

Cheers,Rachel

P.S. I welcome any thoughts you’d like to share — I read them all, always. Just click reply. 👍

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