The ERE Wheaton Scale

[luxagraf]

This is good. To me ERE seems to be a progression from 21st century conventions back towards homesteading. In a sense in the extreme it's like homesteading with a big bank account and possibly residual income from conventional life.

Perhaps, but in the ERE community there has long been a homesteaders vs. nomads dichotomy. The early days of the ERE blog even seem to me to have been a bit closer to the nomadic side and have moved more towards homesteading as time went on.

Having myself drifted from one end of this spectrum to the other and back again, I would have to say that one of the things that has kept me interested in the basic tenants of ERE is its ability to speak to both ends of this spectrum. To me the common element regardless of nomadic/homestead is conservation of resources, particularly energy, whether that energy is money earned and saved, food grown, etc, etc until a stable, resilient system is in place. For me financial independence, while certainly part of the picture, is the least interesting aspect (perhaps because I ended up here from reading about peak oil and was particularly interested in how to set up a system in which removing all money from my life would have as little effect as possible.)

I've lost track of who to quote in the thread now, but I think this was Brute's take:

creatively constructing redundant, stable, self-reinforcing systems of diverse elements where inflows and outflows are matched throughout the systems

which can apply equally to both nomads and homesteaders and everyone in between.

[IlliniDave]

Perhaps, but in the ERE community there has long been a homesteaders vs. nomads dichotomy. The early days of the ERE blog even seem to me to have been a bit closer to the nomadic side and have moved more towards homesteading as time went on.

Okay I've no horse in that race. Actually, in the sense I was thinking, they could be functionally equivalent when it comes to the ultimate metamorphosis to independence of the financial system and specialization mentioned above where a person relies on his own skill and labor for essentially all needs.

[J_]

@jacob:good and helpful summary, but
please explain what you mean with BLM (6)and SWR-"schmess-dubya-R"(8).

[BRUTE]

I think you're still thinking in terms of karate belts or standardized test rankings.

no, in fact brute was trying to convince jacob that jacob's table is still a belt system, despite all the anti-belt pro-swordmanship rhetoric.

[jacob]

@J_ BLM is the Bureau of Land Management. A lot of territory in the Western part of the US is owned by the government and you can stay there for free (I think 14 days before you have to relocate). Level 8 refers to SWR being a silly concept at this level, see https://en.wikipedia.org/wiki/Shm-reduplication ... e.g. fancy-schmancy.

@brute - I can see how you can think the table is a belt-system. Can you see why some others as well as myself can think the table is something else? Insisting that it's a belt-system w/o acknowledging other perspectives just tells me that I can't haphazardly share the table publicly because the use of ordinal numbers will automagically result in about half the people seeing it to start ranking themselves or playing progress-quest with the entries.

This is similar to how about half of all college students think that college is just about collecting a bunch of grades in a bunch of classes w/o considering how their actual education has more to do with whether they're capable of integrating those lessons and applying them elsewhere. IOW, the GPA-for-the-sake-of-GPA crowd operates very much in a context-free environment. In Dreyfus terms, they're advanced beginners.

Similarly misuse obtain from MBTI testing when people think that their personality obtains from the test-score rather than the test-score resulting from their personality.

The main reason that the table is not and can not be a belt system is simply that there's no one who prevents any teaching of higher levels before one has graduated in some way from the lower level. People are therefore gauged strictly on their skill as it appears; not by some authority that hands out belts.

[BRUTE]

like brute mentioned in his lengthy reply, that's what jacob gets if he writes down a fixed number of columns with numeric levels of 1-10. this is just inherent in the form. that's why brute recommended non-numbered, independent (vs. grid organized) axes that can still be ordered.

so it's not that everybody is misunderstanding jacob, it's that jacob chose a medium that seems unfit for what he's trying to accomplish. if brute understands jacob's intent correctly.

in a way the college analogy is apt - by standardizing and grading everything, the system incentivizes people to ignore non-standardized, non-numered, non-measurable pursuits.

brute's understanding of jacob's intent, maybe to clarify as brute may have gotten it wrong:

jacob wants to have a type of "manual" so that if he encounters an individual with interests in somewhat ERE related topics, he can point them to a few appropriate interesting steps on wheaton levels just above them, so they won't freak out but actually be able to make use of it.

this "manual" would be a formalization of knowledge that jacob and other ERErs have acquired over the years.

maybe to jacob, "Paradigm" is the main column, with the other ones being side effects - i.e. a human who thinks in terms of "Optimization" (maybe an engineer) would likely have MMM-type CoL, FI goals, and experiences/vacations.

to brute, this is confusing in the grid in two ways: first, because Paradigm seems to be on equal terms with all the other columns just from the layout. second, because in brute's not so humble opinion, paradigm is very local to certain domains. brute optimizes in some domains, but chops wood & carries water in others. for example, brute has been washing his clothes by hand in a bucket for a year now, even though brute has a free laundry machine that came with the apartment he's renting. chop wood & carry water. on the other hand, brute currently has a negative savings rate and still eats lot of steak.

while brute is obviously a unique snow flake, all individuals are in some way.

brute's recommendation: form follows function, but function also follows form. this table seems to invite others to think about this mental model in a way that jacob does not want them to think about it. maybe another form is more conducive.

[George the original one]

I see brute's point. Naming the boxes rather than numbering or lettering them, putting them in some form other than a matrix hides the "level" aspect that people have been trained to see when they look at a matrix.

[jacob]

I think a bonus observation of this exercise is that there are also Wheaton levels when it comes to one's perception and use of tables

[BRUTE]

what is jacob's goal for this ERE roadmap? what does he want it to achieve?

edit: and yes, customer interviews with user stories. old habits die hard.

[Ego]

I think a bonus observation of this exercise is that there are also Wheaton levels when it comes to one's perception and use of tables

Another possibility.

https://en.wikipedia.org/wiki/Law_of_the_instrument

Wheaton hammer

[George the original one]

Use a Venn diagram? Certainly provides for more shades & mixtures compared to a table.

[jacob]

It is clear that this table is strangely divisive in opinions, but rather than repeat the whole argument again---what the table is for, how it works, and how it doesn't work---it might be illuminating to see what similarities you otherwise share with people who have the same opinion about/take on/approach to the table as yourself.

[Fish]

Have we identified all the relevant mindsets and accurately characterized them? I tried doing this above, using Jacob’s levels and limiting it to the personal finance dimension. The ordinal numbers on the PF Wheaton scale are not a rank, but are used to provide an indication of “Wheaton distance” between mindsets. A difference of 1 indicates that the mindsets are somewhat able to relate to one another, while 2 is difficult, and 3+ is incomprehensible.

Here’s a quote from Jacob from a thread that discussed mindset as it pertained to class (viewtopic.php?f=3&t=8041&start=50#p124898). I think it’s pertinent here (substitute “class” with “PF Wheaton level” and it still makes sense).

I get the impression that you still think of class as some kind of ordinal ranking system with one being above the other, etc. Better to see classes as different kingdoms. Different kingdoms have different values and customs. (...)

You can move to another kingdom but that's not immediately going to make fit in and be one of them. You're not going to instantly change someone's cultural makeup by giving them a new passport. You're not going to change someone's class by transferring $50M in or out of their bank account. Someone, say from the underclass, winning the Powerball is not immediately going to start acting or thinking like a wealthy person. They're not going to instantly develop a strong opinion on the capital gains tax. If they're from the middle class they're not instantly going to switch everything out of their Vanguard index religion and into a checking account having suddenly understood that ROI no longer matters for their personal accounts---that money is now a resource like air which will never run out. Rather they're going to act according with their underclass understanding of money and spend the money on luxury cars and bling. Conversely, let Trump go bankrupt for the fifth time. He's not suddenly going to switch to thinking or speaking like a college graduate while deciding that his best strategy will be to apply for a position as a store manager at the local home improvement center in order to "build up his FICO score". In particular, he would not try to regain his wealth like a middle class person tries to become wealthy---by diligently saving in index funds and negotiating better salaries.

[Dragline]

It is clear that this table is strangely divisive in opinions, but rather than repeat the whole argument again---what the table is for, how it works, and how it doesn't work---it might be illuminating to see what similarities you otherwise share with people who have the same opinion about/take on/approach to the table as yourself.

As others have mentioned, the trouble with these things is that whenever there are scales or lists, they tend to invite competitive behavior to establish differentiation. It appeals to our cognitive biases of Associative Coherence, Substitution, Representativeness and the Conjunction Fallacy.

But OTOH, it IS amusing. This thread actually reminds me of the "Tar Baby" story, with jacob playing the part of Br'er Rabbit. Let me know when you are ready to be flung back into that ERE Briar Patch.

BTW, what is GRS?

[BRUTE]

maybe the trouble is with the original Wheaton scale - it seems that all criticism of the jacob-table also applies to the Wheaton scale. maybe Wheaton just doesn't have forum members that have read Tufte and design tools for a living

[Fish]

Here’s a metaphor that almost works:

Instead of thinking of the different PF Wheaton Levels as a numbered list, let’s take the world map and assign each level to a continent. Then this becomes a map of where the levels stand in relation to each other, where continents (mindsets) that are geographically proximate are better able to relate to one another.

Code: Select all

Mindset                Continent       Population
-------                ---------       ----------
Scarcity               Asia            4,436,224,000 (59.69%)
Accumulate             Africa          1,216,130,000 (16.36%)
Exponential growth     Europe          738,849,000   (9.94%)
Embracing efficiency   North America   579,024,000   (7.79%)
Optimization           South America   422,535,000   (5.68%)
Yields and Flows       Oceania         39,901,000    (0.54%)
Systems Theory         Antarctica      4,490         (0.00%)

Note that Asia, Africa, Europe are geographically close. What we’ve been calling levels 1-3 (Scarcity, Accumulate, Exponential Growth) are the typical paradigms that cover most people. Although these paradigms are a difference in kind, they relate best to one another. Then for whatever reason (dissatisfaction, burnout) a few people will voyage to the “New World” of frugality, starting with Embracing Efficiency (North America). Some may take it a step further and migrate to Optimization (South America). A few people are able to see it in terms of Yields and Flows, this is a big jump in thinking that is a continent (Oceania) all out on its own. And at the edge of the world is Systems Theory (Antarctica) that is inhabited by a handful of research scientists.

And the pertinent questions are: Do we have all the mindsets (have we identified all the continents in the world of personal finance)? Have we accurately characterized each mindset (is our map correct)?

[jacob]

@Dragline - GRS is Get Rich Slowly. Once the king of pf bloggers and home of the mighty JD Roth before he sold it for an unknown but rumoured to be a rather large sum (seven-figs?!) of money.

@Fish - Have we defined and characterized all the levels we're aware off? I think yes and no. Yes, because after 4 pages, I don't see any indication of new levels being suggested (exception wrt level 8, see below)---in particular, I can fit all new suggestions into the existing framework; and because based on the type of objections so far ("isn't ERE just a collection of independent parts?!") or the type of suggestions ("let me make a list that is entirely scaled according to how many millions one has in the bank", e.g. the moneyboss and Joshua Sheets scales) I would be entirely comfortable assigning these perceptions to already existing levels in the jacob-table. I revised it a few times in the beginning, but after two pages in the thread, it's now useful enough for my purposes to have fully converged (within accepted uncertainty and accounting for a few non-financially-oriented outliers who either just started or hasn't gone through the financial track or simply find the financial vernacular of the table rather useless for their purposes, namely, brute, 7wb5, and Ego).

And no, because by construction, we can't really define levels we're not even really aware of. Insofar I'm concerned, this only has bearing on level 8 (and possibly higher). Similar to the class-problem you quote. It's very hard to know what one doesn't know and very hard to construct a framework if one only has "local" knowledge of the range. It seems that it's pretty clear (to some) that the focus and paradigm columns more or less follow the Dreyfus model of skill acquisition when described in personal finance terms insofar the focus is mostly about money and FIRE (and this holds for 95% of everybody here and on pf blogs). I really like the Dreyfus model but an alternative to the Dreyfus model is the Bateson model (IIRC, I've linked to both models somewhere) above. I think Bateson is way too abstract/wide to be of practical use. I also think the Dreyfus model explains (maybe incorrectly) the Wheaton observations to some degree. E.g. if a system/ERE or table is interpreted as a collection of equally important parts that must be interpreted in a rigid way (by means of a number) then it might not be easy to accept that others are willing to prioritize different aspects of the system or table depending on circumstances and draw conclusions that aren't based on strict computation. In particular, it will be hard to explain to the typical Dave Ramsey client or even the average Boglehead what exactly ERE is because in their world, what they see, is extreme sacrifice and eating lentils. They're blind to seeing the world as flows or the crucial difference of thinking in systems instead of lists of independent parts.

For example, on this forum there's a distinct difference in the interpretation of ERE itself that generally falls into two camps, almost. One where ERE is just an earlier kind of normal early retirement. The focus/paradigm here is mostly one of faster accumulation coupled with a reduction in expenses and so I'd say that's a 3 or 4 in my table. And then one where ERE is a systems theoretic web-of-goals approach that requires integrating a lot of different parts so that the sum of the whole has an even greater efficiency (level 7) than looking at the efficiencies separately (level 6) or just optimizing each efficiency individually (level 5).

So going back to the the question of exactly what level 8 is, if we stick to Dreyfus, level 8 to me is mastery. This is the point where one has

situational recollection, holistic recognition, intuitive decision, absorbed awareness

The difference between level 7 and 8 is that awareness becomes absorbed (=passive or not actively thinking) rather than actively monitored (=conscious effort required). In other words, the learning is complete. The person no longer thinks about it. The building is done.

Edit: It could be that the real end-level of mastery is at 10 and so I'm missing the evolution through 8 and 9 but I have no idea what those would be insofar we stay inside the personal finance domain.

[BRUTE]

so the different levels are different in kind, not just in scale (<-it says scale right there!).
and since jacob doesn't know what he doesn't know, there might actually be 11 levels, or 24. who knows. or maybe the best division leads to 4 levels in some areas. the table suggests all areas have exactly 8 levels, and that's the maximum, implying 1)an end, 2)complete knowledge of the terrain.

fun fact: until just a second ago, brute has been assuming that there are 10 levels in jacob's table, WHILE STARING AT IT in a different tab. even though it only has 8 levels. that suggests 2 things:

1)brute is dumb
2)tables of levels in categories lead to preconceived notions. tables of skills just have 10 levels, that's how it goes.

[FBeyer]

I think a bonus observation of this exercise is that there are also Wheaton levels when it comes to one's perception and use of tables

Well no shit?
Then think twice before releasing another potential large scale misunderstanding of what you and/or ERE is about.
You already hate indexing, you hate ramen and love lentils, you don't want to own a house, and now you've turned ERE into a role playing game.

Friendly reminder: You have plenty of people here who still think ERE is something about money imagine what happens if you ever release a graphic detailing the 'required levels' of ERE.

The first rule of communication is: keep the audience in mind.

[Ego]

Edit: It could be that the real end-level of mastery is at 10 and so I'm missing the evolution through 8 and 9 but I have no idea what those would be insofar we stay inside the personal finance domain.

As a product of my time I would have been incapable of dissent had I known there might be a 10.

https://www.youtube.com/watch?v=p8TUWilKb6M

Sadhu.