Some things are designed to impress, others to work. Morgan Housel compares flashy architecture with financial advice that sounds good but fails in practice.
Worth a read and a good reminder to keep things simple.
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And i just came across this one yesterday by Morgan Housel
Some excerpts from the article:
I think the tariffs are a terrible idea. Not just a terrible idea, but a horrendous idea.
Every crisis has its own little unique flavor of whatās going on. But the common denominator is this feeling that you canāt see the future anymore. And that makes people go crazy in, turns them into political junkies. It makes āem make bad investing decisions. Thatās always been the case. Try to avoid that. I would also say that for most investors, 99% of good investing is doing nothing.
Most investing is just not doing anything, not trading, not selling. Just letting your money sit there and to hopefully grow over the years and decades. Thatās 99% of good investing. 1% of good investing is how you behave when the world is going crazy. And this, I think, is one of those periods when the market falls 20% in a week.
That is one of those periods when it is so absolutely vital that you keep your head on straight.
Napoleonās definition of a military genius
āA military genius is the man who can do the average thing when everyone else around him is losing his mindā
It is the exact same in investing to be a good investor over time. You donāt need to make a lot of genius decisions. You just need to be merely average when everyone else is making bad decisions, as many people are.
When things are declining, when things are getting worse in your eyes, it is easy to extrapolate and say, well, itās gonna keep getting worse forever. Itās very difficult to envision the counter forces of. Peopleās reactions and lower stock market valuations that push in the other direction. It is true in every single previous bear market that those counter forces set the seeds for the next bull market, but virtually nobody saw them coming at the time.
That lower valuations plant the seeds of the next bull market, that people becoming frustrated with this political environment. Push for change. Itās always difficult to see those, but they always happen. That is happening right now at this moment. There are counter forces all over the place that are setting up the next bull market.
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