Avoid Mistake #1 of Financial Anything

“I don’t know, see it worked out in the long run, I was right” is a statement that you should never use, and never believe. The quote does accurately describes LUCK.

Confusing luck for preparation/knowledge leaves you exposed to unintended risks. Intended risk? No problem, as long as you take it with your eyes open. I have now summarized this book, the book I wished I was smart enough to have written. No chance, btw. Read this book before mine, my book happens to be available for pre-order on amazon.com, I ‘might’ have mentioned this.

The issue is that since the information in this Substack is not readily available or frequently publicized (you’ll have to dig and dig), you are not fully equipped to understand how/why outcomes in financial markets can occur. So you are left with “it’ll be ok in the long run.” Even then, randomness occurs. All of the prior statements in this, and every post, do not mean that the outcome is certain. Never. Ever.

If you add your personal situation (age, health, commitments, goals) in the mix, that is a lot riding on an erroneous foundation.

  • Tell that to auto industry employees, whose jobs, home values, and retirement savings plans plunged, all at the same time. It took multiple government programs, the remnants still exist today. It left behind the singular principle which have propelled asset values to where they are today: the idea that the government will keep interest rates low.

  • Tell that to the employees of Vanguard, which was forced to retract an intended change: link.

  • Tell that to the employees of Dupont & Dow Chemical, whose traditional pension is being converted to 401k: link.