The Choices We Make, The Lives We Live

Carter Thomas
9 min readOct 21, 2023


NOTE: I wrote this on my weekly music blog but figured I should post here as well. I would also encourage anyone to re-read my post called The Liquidity Tax from September 2022 which highlights many of the same ideas.

Good morning. I know it’s Saturday. This week has been quite intense as I ventured into the depths of the VIX index and 8-Sigma bond moves. In English that means that the markets were very volatile. Better late than never but I finally feel like I can come up for air.

To commemorate this wild week I think it would be fitting to pass along my two cents on the financial world since I get lots of people asking me about where things are going.

Do not take any of this as financial advice. Make your own decisions and talk to a professional. I have a unique perspective on things but that does not qualify me in any way. I have to say this for a variety of reasons, so that’s that.

I want to share two stories with you. I believe these stories hold truths that can unlock a lifetime of riches and financial prosperity. I also believe they can be applied to much more than just finance — in fact, if you go back and read these posts, you will notice that all the content here rarely has to do with the literal examples I give. Kind of ironic since I was so bad at reading comprehension growing up.

The first story takes place in 2013. I had just sold some iPhone apps to a hedge fund manager and was making more each month than I did in a year back in Maine. This is not to brag (at all) rather to paint a picture of how big the firehose was. Money was pouring in.

Each morning I would wake up and look at my bank account. Every day it got bigger. The most insidious thing about cash flow is that you think it’s going to last forever — at least with single infusions you know it’s only one time so you are forced to have some discipline.

With this mindset that 1) I was a genius and 2) this money would always be coming in, I began to “invest in myself.” I hired a personal trainer 3x a week for $2200 a month. I bought Armani suits for parties. I flew to Hawaii every weekend for no particular reason. I joined $25k/year masterminds and hired professional coaches. I just. Kept. Spending. Money.

The money continued to come. There were ups and downs but generally speaking it was a wonderful time for my finances. Everything was great and I kept telling myself that next month I’d stop the spending and start investing. There was no rush bc, of course, it would always be like this. How could an index fund ever outperform me?

Then the app market became more saturated and things slowed down. I started other businesses to make up the difference but the overhead slowly ate away at the net profits. By 2016 I was still ahead of the game but confused by my lack of real growth. I guess paying 55% in taxes didn’t help. And partying all the time.

But that isn’t the point of the story — what was more painful was realizing I just missed 3–4 years of the most incredible investments imaginable. Early tech, Bitcoin, Tesla — all assets I owned very early on but not nearly enough of — began to print 10x, 20x, 50x returns. While I was spending my time in a pool of self-righteous Kool Aid, the path to generational wealth passed me by. The worst part is that I knew it was happening in real time and that it was the right thing to do…I just didn’t do anything about it.

I prioritized the short term instead of thinking about the long term. And I paid for it, literally.

The second story takes place in May 2021. As you know, I am a discretionary trader who uses quant based signals to make decisions. Sometimes this is automated (algorithms), sometimes it’s just my brain. These signals tell me when things have reached extreme prices both up and down. They also tell me when big moves are coming. It’s quite simple and is the hardest thing I’ve ever taken on.

In April of 2021 the crypto markets were in full bull mode. It was everything that you see in a bubble — euphoria, mind boggling profits and lack of realism. Everything was going up 100% a day. More importantly, our collective wealth was going up 100% a week. We, the crypto community, all believed it to be the beginning of the “Golden Bull Run” which would be bigger than we could ever dream. As prices continued surging, so did our confidence.

And then on a Sunday afternoon in Early May, I somehow found myself on a Zoom call with one of the greatest financial traders in the history of capitalism. He was starting a new fund and wanted to chat about crypto. After about an hour he asked if I had anything else I wanted to talk about. I paused, knowing this was the opportunity of a lifetime, and asked him what the thought about the upside for the crypto markets. He smiled, looked at me dead in the eyes and said, “Carter — I think it’s a good idea to look at your risk profile right now.”

We ended the call and I went for a walk. I remember thinking to myself how incredible this was, to be Zoom-ing with someone like this, and how this market was going to explode to the upside. Unadulterated, blinding euphoria got me to ignore the smartest financial mind on Earth.

The next morning I woke up and felt differently. I looked at my trading system. I saw nothing but quant signals screaming at me that the top was in. These signals had been screaming at me for about 3 weeks yet somehow I was ignoring it. I didn’t want to believe it.

I immediately felt something click. Between what the hedge fund trader told me and these signals, it was all so obvious. Get the fuck out. Get out while you’re ahead. You’ve already made it bro, stop being greedy. It was a rush of urgency coursing through my veins as I unloaded everything I could.

I sat there and stared at the cash position I was left with. It was completely surreal. It did not feel like real life. Not bc of the number but bc I was able to get out before things popped. It was a mix of gratitude, relief and anxiety.

In the next week the market went up a little bit and then had a 50% sell off giving me a chance to re-load everything once again at half the price.

The feeling of moving yourself off the tracks before the freight train hits is one thing — the feeling of seeing the freight train coming and knowing you will be OK is another.

These two stories crystalize the most valuable experiences I have had in the last 10 years related to markets and money. I have learned to stay objective and to stay grounded as best I can. I have learned to keep my eyes open for potential risks. I have learned that I am a human being just like everyone else and should balance the short term with the long term.

Which brings me to today.

I believe we are about to enter a period of history that will be difficult for many people in the USA and abroad. It will be difficult because of higher prices and fewer jobs. It will slowly eat away at our savings accounts and do everything possible to keep our incomes capped. We will wake up two years from now and wonder why our portfolios are flat, why our bank accounts are thinning and why dinner costs $200.

Maybe you already feel this way. Maybe you’re also noticing more and more people losing their jobs but not stressing bc they have plenty of savings stashed away and a good severance package. Maybe you feel the same lack of urgency I am feeling as I watch people nonchalantly plan their life assuming everything will just go back to how it’s always been, no questions asked.

The worst part is the entire time we will be gaslit by the powers that be as they explain how we’re so much better off than we ever have been. There will be no immediacy like there was in March 2020 bc, most likely, we will not see any sort of market crash. It will just be a slow bleeding of wealth, liquidity sucked from the system and pushed into a dying bond market.

For the next two years I would encourage you to remember the two stories I laid out above as it relates to this phenomenon.

The first story is about what happens when you fail to recognize the best use of liquidity. Back in 2013 it was a lack of investing. In 2023 it is about stacking all the cash you can (in a money market account yielding ~5%).

In other words, stop spending so much fucking money and start saving. Stop telling yourself that you only live once and you deserve it. Stop ordering so much shit on Amazon. Stop fantasizing about the dream trip in first class. Stop ordering delivery food. Wait two years, then go nuts, but for now, I am telling you that the absolute best thing you can do is to take your burn rate as low as possible.

The second story relates to how I am feeling the exact same way I did in May 2021 — I see this so clearly as if I just woke up from the Matrix. It’s a feeling of “wow, I am so glad I realized this before it’s too late.”

This doesn’t mean the markets will crash or go down (in fact, they will probably go up for the next few months), it means that the world we live in is going to punish the people who can’t exercise restraint and discipline. Anyone reading this who lived through the 70s probably understands what I mean. The world is very different with high interest rates and higher prices, something my generation and the ones younger than me have no concept of. And it’s hard, especially when you’re used to low interest rate bull markets.

The good news is that once this period is over we will see unprecedented growth and prosperity. The second half of this decade will be truly remarkable with innovations in energy, food and healthcare.

But we need to get through this period of pain first. You need to come out on the other side with enough cash to take advantage of it all.

Again — if you don’t change anything about your life, you may be fine. Things may go smoothly for you and nothing really happens. What I am saying, however, is that these are the periods of time when you can separate the wheat from the chaff and stay ahead of the game. Because if things do get out of control with global debt and interest rates, you will be so, so glad you are sitting on lots of liquid security (cash), the same way I was so glad I sold crypto when I did.

As a trader I’m going to continue to do what I do and play the volatility, trading futures and the S&P 500. As an investor I like money market accounts (cash), gold and Bitcoin. What you do is your choice.

But more than any asset class what I really like is seeing my monthly expenses dropping. My first boss once told me that “You can’t save your way to success” which I fully agree with, but when growth isn’t on the table, sometimes you gotta do what you gotta do.

In any event, I hope this leaves you feeling prepared and aware. I’m not going to blow smoke up your ass and say things will be great in the coming years, because I don’t think they will be, but at least there is something you can do about it.

Stop spending so much money. Learn to live on less for a while. This will set you up for decades of prosperity in the future when the growth machine turns back on.

Good luck.