The key thing about evolution is that everything dies. Ninety-nine percent of species are already extinct; the rest will be eventually. There is no perfect species, one adapted to everything at all times. The best any species can do is to be good at some things until the things i … | Continue reading
The Battle of Long Island was a disaster for George Washington’s army. His 10,000 troops were crushed by the British and its 400-ship fleet. But it could have been so much worse. It could have been the end of the Revolutionary War. All the British had to do was sail up the East R … | Continue reading
Long-term thinking is easier to believe in than accomplish. Most people know it’s the right strategy in investing, careers, relationships – anything that compounds. But saying “I’m in it for the long run” is a bit like standing at the base of Mt. Everest, pointing to the top, and … | Continue reading
There’s a saying – I don’t know whose – that an expert is always from out of town. It’s similar to the Bible quote that no man is a prophet in his own country. That one has deeper meaning, but they both get across an important point: Everyone’s human, everyone’s flawed, nobody kn … | Continue reading
Michael Jordan said he had to reconstruct his body when he went from basketball to baseball back to basketball. Baseball favored strong arms and chest; basketball required a leaner figure with a stronger core and legs. Part of the reason Jordan’s basketball return was rusty was b … | Continue reading
There aren’t many iron laws of money. But here’s one, and perhaps the most important: If expectations grow faster than income you’ll never be happy with your money. One of the most important financial skills is getting the goalpost to stop moving. It’s also one of the hardest. Fi … | Continue reading
There aren’t many iron laws of money. But here’s one, and perhaps the most important: If expectations grow faster than income you’ll never be happy with your money. One of the most important financial skills is getting the goalpost to stop moving. It’s also one of the hardest. Fi … | Continue reading
Steven Pressfield wrote for 30 years before publishing The Legend of Bagger Vance. His career leading up to then was bleak, at one point living in a halfway house because it had cheap rent. He once spoke about the people he met living there: The people in this halfway house, we u … | Continue reading
Rare and helpful: Low susceptibility to FOMO. But for a different reason than you might think. The urge to buy an investment because its price went up means you probably don’t know why the price has gone up. And if you don’t know why the price has gone up you’re more likely to ba … | Continue reading
Evolution knows what it’s doing. And one of the things it does is give animals bigger bodies over time. Edward Drinker Cope was a 19th Century paleontologist. His work, later deemed Cope’s Rule – not universal enough to call a law – tracked the lineages of thousands of species an … | Continue reading
At one end you have the pure optimist. He thinks everything is great, will always be great, and sees all negativity as a character flaw. Part is rooted in ego: he’s so confident in himself that he can’t fathom anything going wrong. Then there are extremely optimistic people who a … | Continue reading
Thirty-seven thousand Americans died in car accidents in 1955, six times today’s rate adjusted for miles driven. Ford began offering seat belts in every model that year. It was a $27 upgrade, equivalent to about $190 today. Research showed they reduced traffic fatalities by nearl … | Continue reading
History is one damned thing after another. A war ends, a boom follows, then a crash, then an uprising, then a pandemic, a breakthrough, a new boom, a new war. On and on, from agony to awe. A question that always arises after a terrible event is why haven’t we learned our lesson? … | Continue reading
History is one damned thing after another. A war ends, a boom follows, then a crash, then an uprising, then a pandemic, a breakthrough, a new boom, a new war. On and on, from agony to awe. A question that always arises after a terrible event is why haven’t we learned our lesson? … | Continue reading
Some things scale well. Double their size and you get double the output (or more). Other things don’t, and my God is it important to know which is which. Let me tell you about Robert Wadlow. He was enormous, the largest human ever known. A pituitary gland abnormality bombarded Wa … | Continue reading
Let me share two quick stories that have nothing to do with investing. I want to convince you of something important and overlooked: Investing is a broader field than it looks, and there is so much to learn about it outside of the narrow lens of finance. The first comes from fore … | Continue reading
The end of a speculative boom can be inevitable but not predictable. Unsustainable things can last a long time. Identifying something that can’t go on forever doesn’t mean that thing can’t keep going for years. Years and years and years. Part of it is emotion. During the Vietnam … | Continue reading
Isaac Newton was a scientific genius at a time when scientists were often denounced as heretics. He had one antidote to this problem: He had to prove his theories beyond any doubt, which required obsessive precision. In his biography on Newton, Mitch Stokes writes: [Newton] could … | Continue reading
The earth used to be covered in ice. Practically all of it. Then it melted, refroze, again and again. Five times this happened in the last few billion years. Scientists knew about ice age cycles long before they knew why they occurred. It confounded them. Then, a century ago, a S … | Continue reading
I want to try to explain why Gamestop went up 100-fold in the last year and why Sears never recovered. They have to do with the same force in opposite directions. It’s a force that can explain a lot of baffling trends lately, and it’s so easy to underestimate and overlook. First, … | Continue reading
Let me tell you the story of two investors, neither of whom knew each other, but whose paths crossed in an interesting way. Grace Groner was orphaned at age 12. She never married. She never had kids. She never drove a car. She lived most of her life alone in a one-bedroom house a … | Continue reading
If something is impossible to know you are better off not being very smart, because smart people fool themselves into thinking they know while average people are more likely to say, “I don’t know” and end up closer to reality. Most professions would benefit from at least one a da … | Continue reading
Germany’s GDP fell by more than half in 1945, when the end of World War II left a pile of bombed-out buildings and starving citizens. No one a few years prior was predicting a 50% economic collapse, but it’s what happened. Then came an equal surprise in the other direction: West … | Continue reading
To grasp how hard it is to predict what will happen after the world is thrown upside down – as it has been this year – you have to know the absurd story of how one of the most important agricultural developments of modern history came to be. It started in 1815 when the volcano Mt … | Continue reading
To grasp how hard it is to predict what will happen after the world is thrown upside down – as it has been this year – you have to know the absurd story of how one of the most important agricultural developments of modern history came to be. It started in 1815 when the volcano Mt … | Continue reading
In 1984 Jane Pauley interviewed 28-year-old Bill Gates. “Some people call you a genius,” Pauley said. “I know that might embarrass you but …” Gates deadpans. No emotion. No response. “OK, I guess that doesn’t embarrass you,” Pauley says with an awkward laugh. Again, zero reaction … | Continue reading
There are two kinds of history to learn from. One is the specific events. What did this person do right? What did that country do wrong? What ideas worked? What strategies failed? It’s most of what we pay attention to, because specific stories are easy to find. But their usefulne … | Continue reading
They’re relevant to everyone, and apply to lots of things: Who has the right answers but I ignore because they’re not articulate? What haven’t I experienced firsthand that leaves me naive to how something works? As Jeff Immelt said, “Every job looks easy when you’re not the one d … | Continue reading
An important thing that explains a lot of things is that good news takes time but bad news happens instantly. Dwight Eisenhower ate a hamburger for dinner on September 24th, 1955. Later that evening he told his wife the onions gave him heartburn. Then he began to panic. The presi … | Continue reading
Woodrow Wilson was the only president with a Ph.D. in political science. He came to office having thought more about how a government functions than most before him or since. One of his complaints was that too many people in government held the belief that it was a Big Machine: t … | Continue reading
Italian psychologist Massimo Piattelli-Palmarini was once asked why people keep making the same mistakes. He said: Inattention, distraction, lack of interest, poor preparation, genuine stupidity, timidity, braggadocio, emotional imbalance, ideological, racial, social or chauvinis … | Continue reading
The person who tells the most compelling story wins. Not the best idea. Just the story that catches people’s attention and gets them to nod their heads. Something can be factually true but contextually nonsense. Bad ideas often have at least some seed of truth that gives their fo … | Continue reading
There has been a lot of recent talk about the impending death of New York City. Some fear that if COVID-19 is here to stay, a densely populated city is the worst possible place to live. Others, including entrepreneur James Altucher, believe that by the time the virus fades, New Y … | Continue reading
“The world is full of obvious things which nobody ever observes,” says Sherlock Holmes. In a different scene he tells a friend while thinking about a crime: “It seems, from what I gather, to be one of those simple cases which are so extremely difficult.” Lots of things work like … | Continue reading
Covid has forced many of us to spend unprecedented amounts of time with a few people (spouses, kids, roommates). You’re wealthy if you still enjoy their company after six months of unbroken socialization. You have a level of independence that goes beyond money. You can cook for y … | Continue reading
This is a story about when big innovations happen. Not how, but when. And to some extent, why. Hopefully you find it counterintuitive at first before it quickly seems obvious. That’s how most important ideas work. And hopefully you’ll see why 2020, for all the hell its brought, c … | Continue reading
A truth in one field often shines a light on another. So let me tell you a story about what cats falling out of buildings teaches us about businesses surviving Covid-19. In 1988 two New York City veterinarians did a study on a topic they had unique insight into: What happens to c … | Continue reading
Robert Walter Weir was one of the most popular instructors at West Point in the mid-1800s. Which is odd at a military academy, because he taught painting and drawing. Weir’s art classes were mandatory at West Point. Art can broaden your perspective, but that wasn’t the point. Nin … | Continue reading
Three days after Ronald Reagan was inaugurated in 1981, New York City Council President Carol Bellamy joined a group of speakers at a luncheon to discuss the country’s future. The group tried to make sense of a world that was hardly recognizable from a generation before. Crime, i … | Continue reading
Leigh Van Valen was a crazy-looking evolutionary biologist who came up with a theory so crazy no academic journal would publish it. So he created his own journal, published it, and the idea eventually became accepted wisdom. Those kinds of ideas – counterintuitive, but ultimately … | Continue reading
This is a few short stories about things that never change in a world that never stops changing. Things that never change are the most important things to pay attention to. Change gets most of the attention, because it’s exciting and surprising. But things that stay the same – ho … | Continue reading
If you were told in January what April would look like, you wouldn’t have believed it. If you were told in April that in May we’d face a nationwide protest so important it would crowd out almost all Covid-19 news, you wouldn’t have believed it. How do you analyze the world when e … | Continue reading
The idea that something can be likely and not happen, or unlikely and still happen, is one of the world’s most important tricks. But let me tell you about a common problem. I’m as guilty of it as anyone else. It’s that most people understand probability, but few actually believe … | Continue reading
I grew up ski racing in Lake Tahoe. I was on the Squaw Valley Ski Team, and it was the center of my life for over a decade. At a conference a few months ago I was asked what skiing taught me about investing. This was on stage, where you can’t ponder your answer – you have to blur … | Continue reading
Life is a little easier if you expect a certain percentage of it to go wrong no matter how hard you try. Smart people screw up. Good people have bad days. Nice people lose their temper. Pablo Escobar expected 10% of the cash he stored in warehouses to be eaten by rats or spoiled … | Continue reading
John Templeton famously said, “The four most dangerous words in investing are: ‘It’s different this time.” Michael Batnick says, “The 12 most dangerous words in investing are, ‘The four most dangerous words in investing are: it’s different this time.’” Both are right. Some things … | Continue reading
The federal government will run a $3.8 trillion deficit this year and $2.1 trillion next year. Those estimates, from a budget-focused think tank, don’t include what’s almost certain to be another multi-trillion-dollar stimulus package or two, or three, in the near future. We’re a … | Continue reading
Time seems to have slowed down. March felt like it lasted longer than some years. February feels like a different lifetime. It’s not just you. Everyone I talk to feels the same. There’s a well-known idea that time feels like it speeds up as you age. Summer break feels like an ete … | Continue reading