Saturday, 30 April 2022

Seth's Blog : Making our decisions

For trivial matters, it's efficient and perhaps useful to simply follow a crowd or whatever leader we've chosen. But when it matters, we need to make (and own) our own decisions. To do that effectively, consider: Do the reading Show your work Avoid ...
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Making our decisions

For trivial matters, it’s efficient and perhaps useful to simply follow a crowd or whatever leader we’ve chosen.

But when it matters, we need to make (and own) our own decisions.

To do that effectively, consider:

  • Do the reading
  • Show your work
  • Avoid voices with a long track record of being wrong
  • Ask, “and then what happens?”
  • Ask, “how would that work?”
  • Ignore people who make a living saying stupid things to attract attention
  • Follow a path you’re eager and happy to take responsibility for
  • Be prepared to change your mind when new data arrives
  • Think hard about who profits and why they want you to believe something
  • Consider the long-term impact of short-term thinking

None of these steps are easy. This could be why we so often outsource them to someone else.

   


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Friday, 29 April 2022

Seth's Blog : "The market has spoken"

Why would someone buy a share of stock for $945? One reason might be that they think they can sell it tomorrow for $950. A more common reason is that someone bought it an hour ago for $940. Of course, this applies to more than equities. Why buy a Birkin ...
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“The market has spoken”

Why would someone buy a share of stock for $945?

One reason might be that they think they can sell it tomorrow for $950.

A more common reason is that someone bought it an hour ago for $940.

Of course, this applies to more than equities. Why buy a Birkin bag for more than $25,000? Because someone else did.

The only thing worse than losing an auction by a few dollars is winning one by a lot.

All of this makes sense until it doesn’t. The “market” is very smart about any given moment in time, but not always particularly smart about the future.

   


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