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43 simple financial lessons that you’ll benefit from.

43 simple financial lessons that you’ll benefit from.

Nassim Nicholas Taleb became famous for his book The Black Swan which taught us to look out for the unexpected X-Factor.

He also wrote The Bed of Procrustes, a collection of hundreds of “philosophical and practical aphorisms” – pithy one-line quotes full of meaning and importance.

I’ve selected a number of these that struck me as financial or life lessons.

Who knows they may even make you a better investor.

Enjoy…

1. Education makes the wise slightly wiser, but it makes the fool vastly more dangerous.

2. You are rich if, and only if, the money you refuse tastes better than the money you accept.

3. The tragedy is that much of what you think is random is in your control and, what’s worse, the opposite.

4. To bankrupt a fool, give him information.

5. The best test of whether someone is extremely stupid (or extremely wise) is whether financial and political news makes sense to him.

6. The stock market, in brief: participants are calmly waiting in line to be slaughtered while thinking it is for a Broadway show.

7. A prophet is not someone with special visions, just someone blind to most of what others see.

8. It takes a lot of intellect and confidence to accept that what makes sense doesn’t really make sense.

9. The fastest way to become rich is to socialize with the poor; the fastest way to become poor is to socialize with the rich.

10. The characteristic feature of the loser is to bemoan, in general terms, mankind’s flaws, biases, contradictions, and irrationality without exploiting them for fun and profit.

11. “Wealthy” is meaningless and has no robust absolute measure; use instead the subtractive measure “unwealth,” that is, the difference, at any point in time, between what you have and what you would like to have. 

12. What I learned on my own I still remember.

13. The calamity of the information age is that the toxicity of data increases much faster than its benefits.

14. The sucker’s trap is when you focus on what you know and what others don’t know, rather than the reverse.

15. What they call “risk” I call opportunity; but what they call “low risk” opportunity I call a sucker problem.

16. The best test of whether someone is extremely stupid (or extremely wise) is whether financial and political news makes sense to him.

17. You can be certain that the head of a corporation has a lot to worry about when he announces publicly that “there is nothing to worry about.”

18. The main difference between government bailouts and smoking is that in some rare cases the statement “this is my last cigarette” holds true.

19. They would take forecasting more seriously if it were pointed out to them that in Semitic languages the words for forecast and “prophecy”

are the same.Money3

 

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