3 things I’m thinking about this week…

1 –  Getting Emotional.  Markets are driven by emotion as much as fact in the near term. And by those who speculate vs. invest. Ben Graham distinguished the two when he wrote “an investment operation is one which, upon thorough analysis, promises safety of principal and a satisfactory return. Operations not meeting these requirements are speculative.”

What starts as investing tends to morph into speculation as the market mood enters the blue zone in this Cycle of Investor Emotions graph below. Speculation says whatever is happening will probably keep happening. Which works...until it doesn't.


2. - The Dumber Side of Smart People.  The insightful Morgan Housel’s recent blog reminded me that intelligence brings with it its own set of mental pitfalls. Many of which are also elements of the fixed mindset described in Carol Dweck’s Mindset. Closing yourself off to good ideas when they don't come from your circle. Being known more for your past insights than current ones. Building stories explaining the unknowable (like short term stock market or interest rate changes) instead of just saying “I don’t know."


3. - Everyone Gets A Plan.  An estate planning attorney once told me that everyone gets an estate plan. It’s just that some of them involve our expensive and slow State probate system.

It’s the same deal with your retirement. Everyone gets a plan. One plan provides a pathway to a growing income that outpaces inflation. The other...won’t.

To know where you stand, it helps to know your “number” – the amount of money needed to fund your desired retirement. I can help calculate yours - just let me know.

…and one more thing

Perfection is rare in many pursuits…including March Madness tournament brackets. Odds of a perfect bracket: 1 in 120 billion for someone with an analytical bent, per this ESPN article. Though 70 million brackets are completed annually, no one has (yet) completed a perfect one. In 2019, Gregg Nigl came the closest per the NCAA...one of his brackets called the first 49 games correctly.

-Dave