Optimism and pessimism are hard to deal with.
Pessimism is vital for survival, and it helps us prepare for risks before they arrive. But optimism is equally essential. The belief that things can — and will be — better even when the evidence is murky is one of the most essential parts of everything from a sound relationship to making a long-term investment.
Optimism and pessimism seem like conflicting mindsets, so it's more common for people to prefer one or the other.
But in my book, "Same as Ever: A Guide to What Never Changes," I write about why knowing how to balance the two has always been — and always will be — one of life's most important skills.
Successful people find a balance between pessimism and optimism
Bill Gates is a great example of how effective this hidden skill is. From the day he started Microsoft, he insisted on always having enough cash in the bank to keep the company alive for 12 months with no revenue coming in.
In 1995, he was asked by Charlie Rose why he kept so much cash on hand. Things change so fast in technology that the next year's business wasn't guaranteed, he said — "including Microsoft's."
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In 2007, he reflected: "I was always worried because people who worked for me were older than me and had kids, and I always thought, 'What if we don't get paid? Will I be able to meet the payroll?'"
Here, optimism and confidence is mixed with heavy pessimism. What Gates seems to get is that you can only be an optimist in the long run if you're pessimistic enough to survive the short run.
Why you should strive to be a 'rational optimist'
An important thing to recognize here is that optimism and pessimism exist on a spectrum.
At one end, you have the pure optimists. They think everything is great, will always be great, and see all negativity as a character flaw. Part is rooted in the ego: they're so confident in themselves they can't fathom anything going wrong.
At the other end, you have pure pessimists. They think everything is terrible, will always be terrible, and see all positivity as a character flaw. Part is rooted in the ego: they have so little confidence in themselves they can't fathom anything going right. They're the polar opposite of the pure optimist, and just as detached from reality.
In the middle is the sweet spot, what I call the rational optimist: those who acknowledge that history is a constant chain of problems and disappointments and setbacks, but who remain optimistic because they know that setbacks don't prevent eventual progress.
They sound like hypocrites and flip-floppers, but often they're just looking further ahead than other people.
So the trick in any field — from finance to careers to relationships — is being able to survive the short-run problems so you can stick around long enough to enjoy long-term growth.
Save like a pessimist and invest like an optimist.
Plan like a pessimist and dream like an optimist.
Those can seem like conflicting skills. And they are. It's intuitive to think you should either be an optimist or pessimist. It's hard to realize that there's a time and place for both, and that the two can — and should — coexist.
But it's what you see in almost every successful long-term endeavor.
Morgan Housel is a money expert and the author of"The Psychology of Money: Timeless Lessons on Wealth, Greed and Happiness" and "Same As Ever: A Guide to What Never Changes." A partner at The Collaborative Fund and formerWall Street Journalcontributor, he is a two-time winner of the Best in Business Award from the Society of American Business Editors and Writers. Follow him on Twitter @morganhousel.
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FAQs
One of Bill Gates' biggest hidden skills is the ability to. balance optimism and pessimism. Bestselling author. and money expert Morgan Housel explains how the.
What is the number one hidden skill behind billionaire Bill Gates success? ›
QUANTUM THINKING — Number 1 'hidden' skill behind billionaire Bill Gates' success. Balancing optimism and pessimism at the same time is not that easy.
What made Bill Gates so successful? ›
Gates is known for his visionary leadership style. He encouraged innovation within Microsoft, fostering a culture that emphasized pushing the boundaries of technology. His hands-on approach and unwavering commitment to his vision inspired his team to achieve remarkable feats.
What skills does Bill Gates have? ›
Adaptability and Flexibility. Gates demonstrated adaptability by transitioning from leading a tech giant to focusing on global health and development through his philanthropic work. This shift showed his ability to apply his skills and resources to a completely different set of global challenges.
What factors contributed to Bill Gates success with Microsoft? ›
In an 2008 interview, Gates credited some of Microsoft's success to his and his leadership team's ability to quickly recognize a mistake, say, "Oops, this isn't working," and try a different approach. He's certainly made plenty of mistakes over the years that he can learn from. Remember Windows Vista? 7.
What makes Bill Gates a genius? ›
In addition to his technical expertise, Gates is also known for his business acumen and his ability to anticipate and respond to changing market conditions. While it is true that he has also been an effective salesman, it is his combination of technical and business skills that has contributed to his success.
How to be successful like Bill Gates? ›
Top 6 Entrepreneurial Tips from Multi-Billionaire, Bill Gates
- (1) Work hard, even in your hard times.
- (2) Never stop or unwind after a new customer sign up.
- (3) Innovate Fast.
- (4) Learn from competitors.
- (5) Don't do the same mistake twice.
- (6) Always be keen on Learning.
What did Bill Gates invent? Technically, Bill Gates didn't invent anything genuinely new. Instead, he and Paul Allen created two high-quality products that computer companies could use: the BASIC programming language for the Altair 8800 and the MS-DOS operating system for the IBM PC.
What is Bill Gates' personality? ›
Enneagram Type. 5: The Thinker. As a Type Five, Bill tends to be curious, independent, and observant. Bill generally loves to pursue knowledge and seeks a deeper understanding of the world.
What is the Bill Gates IQ? ›
What is Bill Gates IQ? Bill Gates's IQ is 157 ± 6, according to our mathematical analysis based on SAT score averages. With a correlation coefficient of 0.8 between SAT scores and IQ, this approach provides a trustworthy approximation. What is Einstein IQ?
Bill Gates adopted an autocratic leadership style in the early years of Microsoft to ensure the company grew at the pace that he had envisioned. Autocratic leaders believe that the best way to manage their team is to control the way they do their work.
What makes Microsoft stand out? ›
The network effect, economies of scale, and strong branding all work in Microsoft's favor, but it operates in highly competitive markets that are changing at accelerating rates. Morningstar assigns Microsoft a wide economic moat based on the competitive success of Office and cloud products.
What makes Microsoft so valuable? ›
The rise of the cloud and artificial intelligence has given Microsoft an edge over rival Apple. Earlier this year, Microsoft briefly took Apple's crown as the world's most valuable company.
How did Microsoft become successful? ›
Much of Microsoft's success can be attributed to its ability to adapt to the changing landscape. In the early days, Microsoft focused on software development and grew into a major player in this space.
How did Bill Gates get money to start Microsoft? ›
Gates did not start Microsoft with a loan from his parents, it was entirely bootstrapped financially. Paul Allen and Gates had saved up a small amount of money from contract work. Together they provided all of Microsoft's seed capital.
What impact did Bill Gates have on the world? ›
Today, over 80 percent of U.S. households own a computer. Along with his partner and childhood friend Paul Allen, Gates transformed the world of personal computing through the Windows computer platform.
How did Bill Gates get into computers? ›
Together with Paul Allen, Bill Gates pioneered the development of Micro-Soft in 1975 (the hyphen was later removed). Like Allen, Gates had first been introduced to the computer age by a teletype machine installed at the Lakeside School in Seattle with funds raised by mothers through rummage sales.
