We love saying that bad habits are easier to build than good ones. But I think that’s wrong. Here’s what made me realize it: I saw a man rolling his own tobacco outside a filter coffee stand. Completely absorbed in his work. Fully focused. The world around him didn’t exist. He was practicing a craft. And this wasn’t…
Read the note →Amen!
Markets change.
Businesses change.
Technologies change.
Human nature is a CONSTANT.
Read Shakespeare to grok people…
Reminds me of something I’ve heard Jim O’Shaughnessy say often:
“At the centre of all market pricing are human beings. I joke the Four Horseman of the investment apocalypse are fear, greed, hope and ignorance, only one of which is not an emotion. Fear, greed and hope have wiped out more money than any market downturn. Because of all the foibles of human nature that are well documented by behavioural research – and now by neuroloigical research – people are always going to overshoot and undershoot when pricing securities. A review of financial markets all the way back to the South Sea company proves this out. As long as human nature doesn’t fundamentally change, we can continue to arbitrage the pricing inefficiencies it creates.”
“As long as human beings price securities, we’ve got something to arbitrage.”