when investing....................

 

. . . lean more heavily on emotional intelligence rather than IQ.   Temperament is more important than brainpower in the markets.

-Ben Carlson

self-hazards.......................

 

      Investing is hard.  You're forced to deal with the constant uncertainty, volatility, fear, greed, and an endless stream of noise.  Your worst enemy in the markets is not the person on the other side of the trade—it's you.

      Doing more, trying harder, making more trades and paying more attention to your portfolio can be hazardous to your wealth.  The most important work you can do as an investor is proper preparation.  And when it is time to act, it will because your plan tells you to, not because of some scary headlines or talking head on financial television forcing your hand.

-Ben Carlson, Risk & Reward

the temperament.....................

 

Investing is not a game where the guy with the 160 IQ beats the guy with the 130 IQ.  Once you have ordinary intelligence, what you need is the temperament to control the urges that get other people into trouble in investing.

-Warren Buffett

Checking in.....................

 

.....................................with Adam Grant:

Emotion regulation is not about controlling what you feel. It’s about choosing how you respond.

Wise people don’t suppress emotion—they find constructive ways to express it.

Intense feelings don’t always demand immediate reactions. They often benefit from deep reflection.

Ah, experience.................

 

Like all of life’s rich emotional experiences, the full flavor of losing important money cannot be conveyed by literature. You cannot convey to an inexperienced girl what it is truly like to be a wife and mother. There are certain things that cannot be adequately explained to a virgin by words or pictures. Nor can any description that I might offer here even approximate what it feels like to lose a real chunk of money.

-Fred Schwed, Jr., Where Are the Customers' Yachts?: Or A Good Hard Look at Wall Street

looking for the door...............

 

This feels like one of those NYT articles that's mainly performing the service of tending to the readers' emotions. Let's all do panic together this morning. When I encounter that sort of thing, my natural instinct is to go somewhere else. If we're doing group emotion, I'm looking for the door.

-Ann Althouse

ownership..................

 

     The root cause of our suffering is our own thinking. . . . Our experience of reality is created from the combination of the events we encounter and what we think about them.  To reiterate, our emotions come not from external events but from our thinking about them.

-Joseph Nguyen, Don't Believe Everything You Think:  Why Your Thinking Is The Beginning & End Of Suffering

bridging.....................

 

We may think of science and art as standing in opposition to one another, but they are bound by a common objective.  Science seeks to find truth in the natural world; art seeks to find truth in the emotional world.  Medicine fits somewhere in between, bridging science, art, and the emotions that move us toward the will to survive, to heal, to take our medicine, to exercise, and to put in motion all those things that keep us healthy.

-Daniel J. Levitin, I Heard There Was A Secret Chord:  Music as Medicine

a sweet voice...............

 

     I fear a tyrant approaching me with a sweet voice so that he may later rule me with the strength of his arms.

     The life of the nations, my love, is like the life of individuals: a life cheered by Hope and married to Fear, beset by desires and frowned upon by Despair.

-Kahlil Gibran, Thoughts and Meditations

cognitive misers...............

 

Nowhere in the modern world do we see the effects of our emotional behavior more clearly than in markets.  Our emotions lead us to be overconfident when we should be humble, panicked when we should be circumspect, and deeply engaged in seeking information that conforms (rather than disconfirms) our preexisting beliefs. . . .

According to Bernstein, humans are "cognitive misers," relying on simple narratives instead of using complex analytical thinking. The more compelling the narrative is, the more corrosive it becomes to our analytical abilities.

-Barry Ritholz, How Not To Invest: The Ideas, Numbers, and Behaviors That Destroy Wealth—And How to Avoid Them

AI versus EI........................

 

Innovate. Break the rules, or at least use them to the human advantage. Be unpredictable in the best possible ways. Look up from that screen. Be a human.

-Kurt Harden, as he ponders Michael Wade's latest substack

Stories..........................

 

Stories that stir our emotions involve situations that feature both sides of a debate—the good and the bad, the positive and the negative, and the light and the dark sides of humanity.  Real-world conflict between positive and negative emotions brings up the issues of values, which make a story engaging.

-Kevin Ervin Kelley, Irreplaceable: How to Create Extraordinary Places That Bring People Together

enmeshed...........................

 

We do ourselves a disservice when we think of human beings as exclusively logic—or knowledge—driven,  and fail to pay attention to the role of emotions.  The two systems are enmeshed because that is the way our brain and our organism have been put together by evolution. . . .

Emotions and feelings are not a luxury; they are a means of communicating our states of mind to others.  But they are also a way of guiding our own judgments and decisions.  Emotions bring the body into the loop of reason.

-Antonio R. Damasio, Descartes' Error: Emotion, Reason, and the Human Brain

messy..........................

 

     What I love about Barry's work is that he views investing as a game of emotions and behavior, rather than one driven by intelligence and data.  That's important, because a) it's accurate and b) behavior is messy (if not sloppy), unpredictable, varies from person to person, and—unlike data—doesn't pretend to offer a simple answer.

-Morgan Housel, from his introduction to this book

On toxic compassion...............

 

 ...................the prioritisation of short-term emotional comfort over everything else.

-Chris Williamson, from here

Uh-oh......................

 As blogger Tim Urban describes it, your brain gets hijacked by an instant gratification monkey, who picks what's easy and fun over the hard work that needs to be done. . . . 

     Many people associate procrastination with laziness.  But psychologists find that procrastination is not a time management problem—it's an emotional management problem.  When you procrastinate, you're not avoiding effort.  You're avoiding the unpleasant feelings that the activity stirs up.  Sooner or later, though, you realize that you're also avoiding getting where you want to go.

-Adam Grant, Hidden Potential: The Science of Achieving Greater Things

Life its ownself.........................

 12.  Change your objective.  The goal is not to feel "good" all the time, it's to be able to express a healthy range of emotions without suppressing or suffering.

-Brianna Wiest, as culled from 101 Essays that will Change the way You Think

The core............................

 The core here is realizing that people are not spreadsheets. They are emotional, hormonal, misinformed, status-seeking, insecure creatures trying their best to make it through the day. So if you have to choose between understanding how the world should work in theory vs. how it actually works in practice, lean towards the latter. It’s like historian Will Durant once said: “Logic is an invention of man and may be ignored by the universe.” That is so smart.

-Morgan Housel, from here

our repertoire............................

I now turn to another feature of the human condition that divides us from our simian relatives: the feature of responsibility.  We hold each other accountable for what we do, and as a result we understand the world in ways that have not parallel in the lives of other species.  Our world, unlike the environment of an animal, contains rights, deserts, and duties; it is a world of self-conscious subjects, in which events are divided into the free and the unfree, those that have reasons and those that are merely caused, those that stem from a rational subject, and those that erupt into the stream of objects with no conscious design.  Thinking of the world in this way, we respond to it with emotions that lie beyond the repertoire of other animals: indignation, resentment, and envy; admiration, commitment, and praise—all of which involve the thought of others as accountable subjects with rights and duties and a self-conscious vision of their future and their past.  Only responsible beings can feel these emotions, and in feeling them, they situate themselves in some way outside the natural order, standing back from it in judgment. 

-Roger Scruton, On Human Nature

a prey.........................

 Human infirmity in moderating and checking the emotions I name bondage: for, when a man is a prey to his emotions, he is not his own master, but lies at the mercy of fortune: so much so, that he is often compelled, while seeing that which is better for him, to follow that which is worse.

-Baruch de Spinoza