The Sketchbook of Wisdom: Now at a Special New Year Discount (Till 5th January 2022)
Right before the year ends, I thought I’d share a handful of ideas I’ve read, learned, re-learned, and wrote about in the past twelve months. Here are 35 of them, in no particular order of importance. I hope you find these useful, as much as I did.
1. You or Me are Not the Market
Earning the long-term returns of the market, of the past or the future, is not in our control. Managing our risks and avoiding ruin, mostly is.
“Rationality is avoidance of systemic ruin,” advices Nassim Taleb.
Trying to avoid the ruin the stock market system enforces upon people who disregard its workings is rational. Believing that you can beat the system at it, by playing the game mindlessly, isn’t.
Someone wise once said –
People destroy themselves in unique interesting ways. Systems destroy people in uniform boring ways.
Now the problem with beating the system for some time is that we get a swelled head. We start believing that if the stock we have invested in has earned us magnificent returns over the past 2-3 months or years, it was entirely an element of our skill and no luck. Yes, that’s how the mind behaves and makes us believe.[Read more…] about 35 Ideas from 2021