Tiny Lessons......................

 

...............................from Farnum Street:

1. “If you have really high ambitions, you achieve great things even if you fail. If you have low ambitions, you achieve nothing even if you succeed.”
2. “You don’t have to be disliked even though people disagree with you.”
3. The people who feel weird, different, and misunderstood are the ones who change the world.
4. Asking for advice makes people think you’re smart because you are clever enough to recognize how clever they are.
5. The faster you reply, the less you need to say. If you reply in a minute, you can say two words. If you wait a day, it’s a paragraph.

20 investing lessons.....................

..........................from twenty years:

 2. Intelligence doesn’t guarantee investment success. Warren Buffett once wrote, “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.”

I’ve met so many highly educated individuals who are terrible investors. They can’t control their emotions because their academic pedigree makes them overconfident in their abilities.

Emotional intelligence is the true sign of investment smarts.

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

 I no longer think that all wars are unnecessary; but some are, and I still think that the Thirty Years War was one of these.  It need not have happened and it settled nothing worth settling.  No doubt it assured the replacement of Spain by France as the dominant power in Western Europe, an event of some importance in the history of the western world.  But the same result might have been achieved at far less cost and without a generation of war among the Germans who were only indirectly concerned in the matter at all.  Several statesmen of genius outside of Germany from time to time dominated the course of the war; no statesman of genius inside of Germany appeared to put a stop to it.  The dismal course of the conflict, dragging on from one decade to the next and from one deadlock to the next, seems to me an object lesson on the dangers and disasters which can arise when men of narrow hearts and little minds are in high places.

-C. V. Wedgwood, as she completes her Introduction to The Thirty Years War

If history taught one lesson................

.............................it might be that the veneer of civilization is very thin.

Yet as ancient observers from Thucydides to Aeneas point out, ideological professions were often high-sounding cover for personal agendas—private feuds, concern over debts, petty envies and jealousies—that ignited whenever the social fabric was torn through sieges, which worked like plagues and revolution to strip away the patina of civilization.

-Victor Davis Hanson, A War Like No Other: How the Athenians and Spartans Fought the Peloponnesian War 

G. E. ..............................

Musings on Markets has an interesting post about how one might think about General Electric today.  In between the lines are lessons for all businesses.   Two excerpts:

"If there is a lesson to learn from GE's fall from grace, it is that even the best conglomerates are built on foundations of sand. Note, though, that while this lesson may be learned for the moment, it will be forgotten soon, as are most other business lessons are, and we will surely repeat the cycle again in the future."

"Don't get me wrong! Jack Welch was an inspirational top manager, a man with vision and drive, but he was also an imperial CEO, who made his board of directors a rubber stamp for his actions. As we look at a new generation of successful companies, this time in the technology space (the FANG stocks and the Chinese giants), with visionary founders at the top, it is worth remembering that power left unchecked in any person (no matter how smart and visionary) is dangerous."

via

On circumstance..........................

     As a progressive and evolving being, man is where he is that he may learn that he may grow;  and as he learns the spiritual lesson which any circumstance contains for him, it passes away and gives place to other circumstances.
     Man is buffeted by circumstances so long as he believes himself to be the creature of outside conditions, but when he realizes that he is a creative power, and that he may command the hidden soil and seeds of his being out of which circumstances grow, he then becomes the rightful master of himself.

-James Allen,  As A Man Thinketh

Unfortunately.....................

"Don’t people learn?   What we learn from history is that people don’t learn from history."

-Warren Buffett

Lessons...........................

     It takes a man a long time to learn all the lessons of all his mistakes.  They say there are two sides to everything.  But there is only one side to the stock market; and it is not the bull side or the bear side, but the right side.   It took  me longer to get that general principle fixed firmly in my mind than it did most of the more technical phases of the game of stock speculation.

-Edwin LeFevre,   Reminiscences of a Stock Operator

30 observations after 30 years..........

Today marks 30 years since a confident young man walked into the back office of Schroder Investment Management in London, to start his first day on the job, the first in his career. Ask me a question back then and I would have answered assuredly and quickly. Today I’d be more likely to say ‘I don’t know’ with just as much confidence.

-so commences this Broadsword Capital post.   Read the whole thing.  Here are a few wee passages:

The lessons stand the test of time. The stocks, companies, and players change, but human nature never changes. We’re all human, even millennials.

Everything is a risk. Getting up, going out, crossing the road, but ultimately I am responsible for everything that happens to me.

Social media is a tough arena. ... Be nice. We all have off days. You never know what’s going on in people’s lives. Everyone’s going through something.

via

Parenting............................

      One Halloween evening, when he was about ten, Eisenhower's older brothers received permission to go out trick-or-treating, a more adventurous activity in those days than it is now.  Ike wanted to go with them, but his parents told him he was too young.  He pleaded with them, watched his brothers go, and then became engulfed by uncontrolled rage.  He turned red.  His hair bristled.  Weeping and screaming, he rushed out into the front yard and began pounding his fists against the trunk of an apple tree, scraping the skin off and leaving his hands bloody and torn.
      His father shook him, lashed him with a hickory switch, and sent him up to bed.  About an hour later, with Ike sobbing into his pillow, his mother came up and sat silently rocking in the chair next to his bed.  Eventually she quoted a verse from the Bible:  "He that conquereth his own soul is greater than he who taketh a city."
      As she began to salve and bandage his wounds, she told her son to beware the anger and hatred burning inside.  Hatred is a futile thing, she told him, which only injures the person who harbors it.  Of all her boys, she told him, he had the most to learn about controlling his passions.
      When he was seventy-six, Eisenhower wrote, "I have always looked back on that conversation as one of the most valuable moments of my life...."

-David Brooks, The Road To Character, as extracted from the chapter featuring Dwight David Eisenhower

On doing.........................

"Perhaps the most valuable result of all education is the ability to make yourself do the thing you have to do when it ought to be done whether you like it or not.  It is the first lesson that ought to be learned and however early a person's training begins, it is probably the last lesson a person learns thoroughly."
-Thomas Henry Huxley

Good questions, all........................

Why is it that entrenched players, with all their resources, can’t seem to innovate?   Why do outsiders seem to respond better to disruption and changes?  How does one learn to spot transformative opportunities?
-as asked by Ryan Holiday in this post on " the story of a central truth of history: that strength often becomes a weakness and weakness can be transformed into strength. "

Lessons learned along the way..................

I learned that failure is by and large due to not accepting and successfully dealing with the realities of life, and that achieving success is simply a matter of accepting and successfully dealing with all my realities.
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I learned that everyone makes mistakes and has weaknesses and that one of the most important things that differentiates people is their approach to handling them. I learned that there is an incredible beauty to mistakes, because embedded in each mistake is a puzzle, and a gem that I could get if I solved it, i.e., a principle that I could use to reduce my mistakes in the future. I learned that each mistake was probably a reflection of something that I was (or others were) doing wrong, so if I could figure out what that was, I could learn how to be more effective. I learned that wrestling with my problems, mistakes, and weaknesses was the training that strengthened me. Also, I learned that it was the pain of this wrestling that made me and those around me appreciate our successes.

-Ray Dalio, as excerpted from Principles

Lessons learned along the way.................Part 3

I have never met a great person who did not earn and learn their greatness.  They have weaknesses like everyone else—they have just learned how to deal with them so that they aren’t impediments to getting what they want. In addition, the amounts of knowledge and the capabilities that anyone does not have, and that could be used to make the best possible decisions, are vastly greater than that which anyone (no matter how great) could have within them.

This explains why people who are interested in making the best possible decisions rarely are confident that they have the best possible answers. So they seek to learn more (often by exploring the thinking of other believable people, especially those who disagree with them) and they are eager to identify their weaknesses so that they don’t let these weaknesses stand in the way of them achieving their goals. 

-Ray Dalio, as excerpted from Principles

Shooting pool.......................................

....with John E. Smith.  Leadership lessons from the green felt.

Lessons......................................

When I turned thirteen, he'd produced his .22 rifle and said, "I think you're ready to learn to use this."  His expression then had been very similar, and I still can't read it.  All I know is he believed that life had stages and they needed to be marked.
      Our infrequent moments of closeness were always enacted like this, over ways of doing.  With the rifle I had to demonstrate I had the maturity to handle what he stressed was a lethal weapon, before he ever put a bullet in the chamber.  Which meant thinking about consequences, being heedful, doing things properly.  It was that, not numerical age, which earned the right to use it.
      Golf was the same.  The teaching he gave us was about more than grip, stance, swing.  He was passing on the ethos and etiquette of the game, which expressed his own deepest values.  They were iron laws.  Never to talk or move when someone else is playing.  Attend the flag for your partners.  Don't hold people up.  Watch your partner's ball, mark where it's gone, help search for it.  Win without gloating; lose without sulking.  Don't show off - but feel inferior to no one.
      There was one lesson even more elemental that these.
      "Bobby Jones several times called penalties on himself for infringements that no one but himself had seen.  He nearly lost the US Open because of it.  And when he was congratulated for his honesty, you ken what he said?"
      My father glanced at me as we drover over the hill to St. Andrews that bright, breezy afternoon.  I think even then I was aware days like this wouldn't come that often.  I shook my head.
      "He said, 'You might as well praise a man for not robbing a bank.' "
-Andrew Greig,  Preferred Lies:  A Journey to the Heart of Scottish Golf

Ed. Note:  This is a wonderful book.  If there is a difficult-to-buy-for golfer on your Christmas list, you can earn significant style points by buying this book for them.  There is still time.

Enduring lessons................................

Lessons learned along the way:

It’s OK to be wrong, just don’t stay wrong. A lack of humility and self-awareness has caused many market commentators to go from pundits to charlatans because they’re afraid to admit they were wrong and are too stubborn to face the facts. Everyone makes mistakes in the financial markets. It’s best to learn from them and move on.

Envy might be an investor’s worst enemy. We can’t stand missing out when everyone else is making money. It’s nearly impossible for investors to buy when everyone else is selling. Envy causes us to search for lottery tickets instead of investment plans. It makes us confuse our time horizons and risk profiles with other people’s. It makes us take on debt we can’t possibly pay back. And it causes booms and busts because we just can’t help ourselves.

Eleven other lessons here.

Trying to remember my history................

The above quote from George Washington has been widely circulated, at least in the real estate world, as just another proof that it is always a good time to buy.  Somebody handed me a copy of the letter yesterday, and as I was reading it again, I wondered:   didn't some of our founding fathers lose their shirts in land speculation?

The short answer is yes;  most noticeably Robert Morris, Henry Knox, and James Wilson.  It turns out that George Washington was actually very successful in the land speculation business.  More on that story can be found in this longish and well-footnoted essay.   Wee excerpt here:

Speculation in land became particularly rampant in the early 1790s when the stability of the new republic seemed assured. Describing the process of speculation, historian Forrest McDonald wrote: “One worked or connived to obtain a stake, then worked or connived to obtain legal title to a tract of wilderness, then sold the wilderness by the acre to the hordes of immigrants, and thereby lived and died a wealthy man. Appropriately, the most successful practitioner of this craft was George Washington, who had acquired several hundred thousand acres and was reckoned by many as the wealthiest man in America.”

I believe the lesson to be learned from our  Founders' experience is that investing in land is a smart, profitable, and worthwhile endeavor; but, one should do it without also acquiring a significant amount of long-term debt.   A timeless lesson.

The genius of the Beatles............................

The Beatles..................................Tomorrow Never Knows

(psychedelia alert)




22 things any business can learn from the Beatles - here

The Key to Science.............................

Knowing when you are wrong is important.  Here Professor Feynman tells his students how to know when you are wrong.