Insight
Morgan Housel argues billionaire traits prevent hedge fund managers from ever stopping
“What's difficult in finance is that the kind of personality that makes you a billionaire hedge fund manager is not the kind of personality that is likely to say, okay, that's enough.”
What-if
Warren Buffett's net worth would be just $10 million without extreme longevity
“Let's say that Buffett, instead of starting to invest when he was 11, let's say he started investing when he was 25, like a normal person. You graduate college, you get some money. He started when he was 25. And then let's say he retired when he was 65, like a…”
Insight
Morgan Housel argues paying off a mortgage offers safety despite low rates
“Paying off your mortgage is ridiculous, but I actually think it's a wonderful thing for people who can do if you can do it. Just to give yourself that added sense of stability and safety and know that no one can touch your house.”
Assertion Partly supported
The 1929 market crash actually recovered by 1936 when accounting for dividends
“After the crash of 1929, the market did not exceed its previous high until 1956, which is true if you don't include dividends. If you do include dividends, the right answer is 1936.”
Assertion Not checkable as stated
Housel: Thousands of Books Cover Wealth Creation But Very Few Cover Spending
“There are tens of thousands of books written about how to get wealthy. Some of them better than others, but tens of thousands of them. Virtually none written about what to do with it.”
Insight
Housel: Most Bad Financial Decisions Stem from Copying Others' Strategies
“Most bad financial decisions happen when you follow the strategy that is right for somebody else, but not for you.”
Insight
Housel: Debt narrows while wealth widens the range of survivable outcomes
“The more debt you have, the narrower the range of outcomes you can endure in life. Very simple, very elementary in that sense. That's how I think about wealth. The more wealth you have, the wider the channel becomes of the range of outcomes that you can endure…”
Insight
Housel: Saving Money Purchases Immediate Independence Rather Than Delaying Gratification
“Viewing it as not saving money, as idle money, as not delayed gratification, but viewing it as purchasing independence that I gained pleasure from today. It's not delayed gratification. If I save money, I benefit from that right now because I have a higher sen…”
Insight
Housel: Ambition fuels societal progress but traps individuals on a hamster wheel
“That's the seed of all innovation, is people waking up and saying, not enough. We need bigger, better. That's great. But the individual level, it puts you on a hamster wheel forever.”
Disclosure
Housel Seeks Material Contentment But Endless Ambition as Father and Writer
“When I say contentment, I want to be content with my house. I don't want to be content with how good I am as a writer or a father or a husband. I never want to drop my standards for that. I always want to do better. I'm never going to be satisfied with how wel…”
Insight
Housel: Who you socialize with indisputably sets your financial expectations
“So much of this is be careful who you socialize with, because they will absolutely indisputably set your expectations.”
Insight
Housel: A big house only brings happiness if it facilitates relationships
“Having that big house makes it easier to host your friends. But the realization is the friends are making you happy. The house doesn't make any difference. But if it's a conduit to having more meaningful relationships, awesome, fantastic.”
Insight
Housel: Conspicuous wealth display often stems from early emotional wounds
“So many people, they have a very high propensity to show off their wealth. A lot of times, it's because they are trying to fill an emotional wound that they had from earlier in their life, of some time in their life when they were snubbed in some way, and eith…”
Insight
Housel: Finance sparks debate because there are infinite right answers
“The reason that finance can be such a tense topic and subject of so much debate in a way that meteorology is not, in finance, there's an infinite number of right answers for different people.”
Insight
Housel: Money Is Used Either for Quality of Life or Status
“There's two ways to use money. One is as a tool to give yourself a better life. The other is as a yardstick of status to insert yourself on the social pecking order.”
Insight
Housel: Realizing strangers do not care about possessions cuts status spending
“Nobody is thinking about you as much as you are. Nobody cares about your house or your car or your clothes as much as you do. They're busy thinking about themselves. Once you come to grips with that, then your desire for impressing strangers plunges, and then …”
Insight
Housel: People default to wealth as life's metric because it is quantifiable
“Part of the reason that it is so easy is because money is one of the only things in life that is so immediately tangible and quantifiable. I'll use the example. If I woke up and said, I want to be a Great goal. I would love to do that. What does that mean? How…”
Insight
Housel: 'Social debt' is a hidden liability dictating your lifestyle
“Social debt is a hidden liability. You don't actually see it, but it's very real. It's when society and your own expectations tell you how to live. And who to be and control your personality, control your desires in ways that might be opposite of your actual p…”
Insight
Housel: Gaining wealth yields fewer bad days rather than constant euphoria
“Relative to where I was five years ago, I don't have more better days, but I think I have fewer bad days, which is a lifestyle improvement. That is a better life. That is an upgrade. But let's not pretend that when people make Some amount of money. They're jus…”
Insight
Housel: Spending $5,000 helping someone in need generates far more fulfillment
“Spending five grand on yourself will probably do nothing. Spending five grand for someone who's in need can utterly change their life. And you get an enormous boost from that.”
Insight
Housel: Children absorb money habits from parental observation rather than direct instruction
“You don't need to sit down your kids and tell them about money. But every time you say, we can't afford this, every time you make a snide comment about your neighbor's yard, every time you choose the hotel to go on, they're always paying attention. And by the …”
Insight
Housel: Books are like seed startups and tail-driven, usually failing despite talent
“All books are basically a seed stage startup in the sense of even if you do everything right, and it's run by talented people and well-funded, it's probably going to fail. That's most of the case. Books are a tail-driven business.”
Assertion Supported
The Psychology of Money Started With 5,000 Copies, Now Nearing 10 Million
“The first print run of Psychology Money was 5000 copies because all the evidence showed us that would be a great outcome, and we're at nearly ten million now.”
Insight
Housel: Selling 10M copies of a book is almost completely unrepeatable
“And the truth is if you sell ten million copies of a book, it's probably not repeatable unless you're like J.K. Rowling. It's just not repeatable.”
