Tourist, Local, and Stubborn Local
Three postures toward a downturn — and the third one drowns while insisting the water is fine.
- Difficulty
- Easy
- Time to result
- ~ongoing to results
- Steps
- 5
- Confidence
- 84%
Sean Puri's original two-part framing: tourists freak out when the seasons change and bounce, because they did not know the environment had seasons at all. Locals know the seasons exist, expect the swings, and stick it out. Bloom adds the third and most dangerous character — the stubborn local, the guy in the coastal village insisting global warming is not real while he drowns. The point is that being a local is not a permanent identity you earn once; the same conviction that lets you survive a downturn is what turns into denial if you never re-examine it. Sean's own 2022 was the live test: liquid net worth down roughly 50%, holdings in big tech, startups, Bitcoin, ethereum and Luna all hit at once. His response was to check whether his family was in actual hardship, decide what adjustments were warranted, and deliberately book losses to offset gains — then stop thinking about it, on the logic that he never took his happiness from the way up so he should not take his sadness from the way down.
Origin
Sean Puri coined the tourist-versus-local distinction in earlier conversations about market seasons; Bloom added the stubborn local while pressing Sean on how anyone avoids sliding from conviction into denial.
Core principles
- 01Tourists do not know the environment has seasons
- 02Locals expect the swings and stay through them
- 03Stubborn locals mistake refusing to update for conviction
- 04Which one you are is only revealed in the drawdown
- 05Your emotional state should not track the price either direction
How to run it
- 1
Establish that the environment has seasons
Before you are in one, accept that drawdowns are a structural feature, not an anomaly. Tourists exit at the first cold snap purely because they never knew winter was part of the deal.
Pro tip Writing down the expected bad season in advance is what converts you from tourist to local.
- 2
Get perspective before acting
Sean's first move in a roughly 50% liquid drawdown was to ask whether he was in any kind of real hardship and whether his family was doing poorly. The answer was no, which resets the whole decision.
Watch out Acting from the feeling rather than the situation is how tourists sell the bottom.
- 3
Decide what actually needs adjusting
Ask whether you were wrong about something, or whether you simply want more comfort. Sean concluded he wanted to stop sweating it, so he margin-called himself deliberately and moved more into cash.
Pro tip Separate 'my thesis broke' from 'I want to sleep better'. Both are valid reasons to act, but they call for different sizes of action.
- 4
Take the deliberate action, including the unglamorous one
Sean booked the loss on purpose to offset gains elsewhere in the year. The point is that the action was chosen for a stated reason, not triggered by the chart.
Pro tip He explicitly noted he is not a trader and not an investment genius, so beating the market was never the goal.
- 5
Audit yourself for stubborn-local drift
Periodically ask whether you are still a local or have become the man insisting the water is not rising. Bloom frames this as the hardest thing — the stubborn local feels exactly like a resilient local from the inside.
Watch out If you cannot articulate what evidence would change your mind, you have already drifted.
In the wild
Sean's pre-2022 position was 'cash is trash' — big tech, a large pile of marked-up startups, Bitcoin, ethereum and Luna. Every category got hit at once and his liquid net worth fell roughly 50%. Instead of panicking he checked for real hardship, decided he wanted less volatility exposure, sold a chosen amount, booked the loss against the year's gains and moved on to other work.
→ He acted as a local: stayed unfazed, made one deliberate adjustment, and stopped monitoring — friends texting to check on him found him totally fine.
Rather than treat the falling price as a signal, Sean re-asked what he believed about the company and whether anything had changed. Nothing had, so he bought more.
→ A local's move — the position size followed the thesis review, not the price action.
Common mistakes
Behaving like a tourist and calling it risk management
Exiting because the season turned, with no thesis review, is the tourist move dressed up. Bloom notes the crypto crowd who piled in on 'number go up' freaked out and pulled out the moment it reversed.
Becoming the stubborn local
Treating conviction as an identity means you keep holding while the evidence accumulates against you. The coastal-village image is deliberately absurd because the failure feels reasonable from inside.
Letting your mood track the price in both directions
Sean's stated test is that he never got his happiness from the way up, so getting sadness from the way down would be incoherent. If the upside made you euphoric, the downside will make decisions for you.
Is it for you?
Best for
Investors, founders, and operators trying to hold conviction through a drawdown without becoming delusional
Not ideal for
Short-horizon traders whose edge is reacting to price rather than sitting through cycles
From the transcript
“the framework you've talked about in the past that I love around this stuff is your um local versus tourist thing I think that's so…”
“I've always just thought there's a third one which is the like stubborn and local like the dude that lives in the Coastal Village and…”
“I never got my happiness from when it was going up so why would I get my sadness from when it's going down didn't make…”
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