The Wisdom Wall

“the equity that you build isn't really wealth because you, when you sell that house, you probably have to buy another one that went up in value just as much. And unless you are moving to a cheaper city, which of course that happens, You're not, you're not getting any benefit out of that.”

“Not having FOMO is the single most important financial skill. I think it's so important that you cannot ever imagine accumulating significant wealth over your lifetime if you are susceptible to FOMO.”

“Investing is one of the very few endeavors in life where the harder you try, the worse you're probably going to do. And yes, there are exceptions to that. Renaissance technologies. Of course, you, you, you can name the exceptions for people who tried very hard and did very well. But for the vast majority of people,…”

“a lot of people who are very successful are just walking anxiety disorders harnessed for productivity.”

“what people actually want to get to, what they aspire to, whether they know it or not, is contentment, which is not happiness. It's a different emotion. You'd want to get to a point where you're just like, I'm good. Like, I'm very grateful for everything that I have, and I have everything that I need, and most of what…”

“That is the root of all progress, is that the majority of people wake up every morning and say, this is not enough.”

“I bet over the course of a lifetime, not in any given year, but over a lifetime, if you compared it to someone whose finances were very complicated and had all kinds of transactions, not only would I be likely to match those, but probably exceed them.”

“I think it's impossible to have a YOLO paycheck to paycheck mentality young in your young years and then assume that you're going to flip a switch when you're 35 and become a saver.”

“if you can help them buy a house when they're 30, that is going to give them a much greater boost in life than if they get a million dollars when they're 75 after you die”

“just be yourself and Is good advice for like five percent of people. And I, I love that, that joke, that mean of like, most people should not be themselves. They should meter what they say and how they behave around other people in a signaling way in order to fit in.”

“the vast majority of what people consider passive income, they're working their butts off for, particularly real estate. If you're a landlord and people are like, oh, it's passive income. No, it's not. Your toilet breaks, the roof leaks, the tenant doesn't pay. They put a hole in the wall. Like, anyone who's been a…”

“gut feelings tend to actually be pretty good. That's not just a gut feeling that it's just that you can't crystallize what the thought is, but you know, which way you should go, you know, which way to do it. I think that tends to be the case that gut feelings are actually pretty accurate more, more often than not tends…”

“One is that all wealth is what you have minus what you want. And it is so profoundly common and easy to ignore the second part of that equation that you have to minus what you want. And you are more in control of that by and large than what you have.”

“If, if you can, if you can look at particularly someone who is above average income and there isn't something in their life that they spend very little on, I think there's a high chance that they're just a sheep going along with society tells them they should want.”

“if you can do something that changes your odds of an outcome, it's not luck by definition. Luck to me, the biggest are where and when you were born. You can't control it. Bill Gates couldn't control it. Elon Musk couldn't control it, but it has a massive income, a massive impact on where you're going to go in…”

“so if it's not to say that the things will make you happy are not material that you should just use this for experiences. That I think is a step too far. I think a lot of people have hobbies that cost a lot of money that are material that really make them happy.”

“So I think most financial debates, whether it's like an investing debate or a saving or spending debate, people are not actually disagreeing with each other. They're not actually debating. It's people with different personalities talking over each other. And once you come to terms with that, there's not one right…”

“Like what, what can money do to make you happier? Because there's no other purpose. There's nothing else that you should even think about other than that.”

“It is inevitable and it is actually ideal that there are some level of inequality. In the world. It's, it's not only, it's not only inevitable, it's ideal. The opposite of that is, is a nightmare, but it's also the, the case that you do not want a third of society waking up every morning and saying, this doesn't work…”

“I think once you start thinking about who is my audience and what are they going to like, you start to pander and you start to like perform for them in a way that is very hard to like Create a good emotional story about. Just write for yourself.”

“I think you can learn more about money by reading about politics, military history, biology, sociology than you will by reading a finance book. Because you're just trying to figure out how do people make decisions? How do you make decisions and how do other people make decisions? And by and large, you're not going to…”

“it is impossible to think objectively about a field that you reap, that you get your paycheck from. And I think that's really true for a lot of money, professional money managers, mutual fund managers, hedge fund managers, that no matter how hard they try, it's very difficult to look objectively at your field.”

“if an article is relevant today, but not relevant tomorrow, then it's not relevant at all.”

“Nothing is a bigger motivator in life than having a couple people Rarely more than that, that you really don't want to disappoint.”

“if you only have the ego side, you're going to run yourself off a cliff, and if you only have the humble slash depressed side, you're never going to get anywhere”

“What I think is true. Is that on average, people who have more money tend to have fewer bad days, but I don't know if they have more better days.”

“Happiness is always a fleeting emotion. Like most people are rarely happy for more than a couple minutes at a time. And I think it's very similar to humor, where if I tell you a very funny joke, you don't laugh for 10 years. You laugh for a couple minutes. Humor is a fleeting emotion, and happiness is the same.”

“literally every dollar that you save is a little claim check on your future that you control that somebody else doesn't. I think it's an important mindset, like redefining independence like that, that it's on a spectrum and every single dollar is an independence claim check.”

“If you have to serve like sum up doing well financially in one word, I think it's survival. That's true in your career. That's true for savings. That's true for investing. Absolutely. It's just survival.”

“this is true for a lot of things, you get pleasure out of contrast. It's just how much, what do you have now and what are you doing now relative to what you were doing before?”

“And by and large, what you have to do in capitalism is put up with a never ending chain of uncertainty and volatility and things you didn't see coming. And so it's never fun to deal with that. A recession, a job loss or stock market goes down. It's never, it's not fun, but that's the cost of admission for doing it.”

“I think very few people know their tolerance for pain. Looking, just trying to be, like, prospective about it. I think you have to experience it in the trenches, so to speak, before you actually know how you're going to feel.”

“And most people, if you ask them the question, how would you feel psychologically right now if the stock market fell? In that exercise, what they do is they imagine a world where everything is exactly the same as it is today, except stocks are half the price.”

“It's the same in investing. Like, there should not be a world in which every ambitious stock picker can beat the market. Of course, whenever you hear the statistics about 95% of mutual funds underperform their benchmark, I'm like, yeah, what would you expect?”

“you should not do it because you have, even if you don't define it like this in your head, because you have some level of FOMO of man, housing prices have gone up a lot and like, ah, that house looks so nice and things would be, and we can't really afford it. Or it's going to be a huge stretch, but oh, life will be so…”

“The simpler it is, the easier it is. I think the higher the odds that I'll just, I can just stay with it. Whereas if it was very complicated, I might get to a point in the economy or my career or my cognitive capacity where like, I can't keep it going. And so I think the higher the odds that I can just leave it alone…”

“And I, I would venture, we're talking first world problems here, of course, but I would venture that many more people have landscapers. Part of which is because they don't want to get dirty. But part of which is, like, I think, I think whether you know it or not consciously, you want people, including strangers, to…”

“probably age birth to 20, you're forming an identity. You're just trying to figure out Who you are. You're trying to make sense of how you're wired and whatnot. You're just figuring out your identity. 20 to 30, I think by and large, you are learning a skill. Hopefully, again, this is great. This is, this is, this is a…”

“I think the truth is no matter the generation, no generation handles their twenties with a lot of grace and dignity. It's a very difficult period because you're still trying to figure out who you are. You are technically an adult. You are technically on your own and kind of, you know, out of the cradle and trying to…”

“It is never as simple as being like live for today or save for tomorrow. It's always just, what are you likely to regret at some point in the future? It could be a year from now. It can be on your deathbed. 70 years from now, whatever it is, always thinking about your capacity for regret, what you are likely to regret.”

“It's always the case that to the previous generation that had a harder, it looks, the, the, the phrase you use is spoiled, but I think what's actually happening is progress.”

“Now, I want my kids, I think, as a broad formula, I want to use the money that I have To protect within limitations, my children's downsides. I don't ever want them to just collapse on their face and they can't work their way out in life. I want to be there to, as a somewhat of a safety net, but I don't want to be a…”

“I think by comparison, they won't, they, they won't appreciate it in greater degrees than we didn't appreciate our progress because of social media, because they have only known an era when, which not just there are some, but there are literally tens of hundreds of millions of people on Instagram who appear to be…”

“And so the things that make my wife and I happy, we like walking our dog, and we like that 10 years ago as much as we do today. And even before we had a dog, we like going for walks and doing this. We like, we like laughing and talking about things in one. It's things that don't cost any money whatsoever. And I think…”

“the yellow sports car, so to speak, tends to be a new fun, a new money phenomenon. Not a lot of old money families with those, or fewer of them, because I think the new money, wealth, like, feels vindicated over what they overcame.”

“a lot of spending is not utility. It's not even rational. A lot of times it's filling a psychological hole that you have from some point in your life.”

“I think it becomes dangerous when the purpose of your signaling is I want to get the attention of strangers who are not in this with me, who are not part of the group that I'm trying to gain the respect and admiration of. I'm trying to gain the attention and admiration of other people who I don't know, who are probably…”

“So just focusing on the financial independence, a level of savings that seems like it's too much. That seems like, oh, this is completely excessive. Do I need this much savings and liquidity? The answer might be yes, because you're probably underestimating the odds of very bad things happening in your life.”

“anything amazing can feel terrible if your expectations are high enough, and everything, anything terrible can feel amazing if your expectations were low enough.”

“Everything is going to be judged relative to your highest moment in the past, and that's a very hard thing to deal with.”

“I always say, like, be very careful who you socialize with, because it will, full stop will set your expectations of what you want.”

“Historically, when we talk about the stock market, a good definition of long-term of like really putting the odds of success in your favor is probably 10 years. Of putting, like, earning a real rate of return after inflation, even within the cyclicality of the economy, you should be investing for at least a minimum 10…”

“nothing can be more damaging to your investing psychology. Than getting rich very quick when you're young. I think it just ruins you. It gives you this expectation.”

“I think people get really, uh, can get kind of testy when you talk about luck, because if I say that you got lucky, I look jealous. And if I say that I got lucky, uh, I feel diminished in, in what I'm doing in life.”

“Not having FOMO is the single most important financial skill. I think it's so important that you cannot ever imagine accumulating significant wealth over your lifetime if you are susceptible to FOMO. Like if there's literally one thing, like one trait that you want that's going to allow you to accumulate wealth, it's…”

“It's always going to be the case that a very small number of stocks account for the majority of returns. So recently it's been, uh, Fang plus Nvidia. If you didn't own those stocks, Fang plus Nvidia over the last decade, your odds of outperforming are very, very low. It's not zero, but it's incredibly hard if you…”

“If your net worth grows 10%, but your expectations grow 12%, that's, that's when you get into trouble. It's just the gap between the two.”

“money is, is kind of the oxygen of independence. And if you can use your money to spend more time with your friends and family, you and I went out to a lovely dinner last night with each other. That cost money. Thank you for buying, by the way. And we had a great time with each other. Now, if you and I went for a walk,…”

“So it's not that the house will make you happier, but the house can make it more conducive to do things in your life that those things will make you happier.”

“People are always going to be keeping up with the Joneses. And you can imagine a world in which our kids and our grandkids are living way better lives than you and I are. And living longer and have better material, uh, access you and I do, and they're no happier for it because they're just competing with other people…”

“You're saving because you want something different, which is independence. And independence is going to give you so much more pleasure than the big house ever would.”

“If you can learn how to be poor with dignity, that skill will just like stick with you forever.”

“The weird thing here is that wealth is the money that you don't spend. That's what wealth is, like the homes you didn't buy and the car you didn't buy. It's money that you saved and invested. That is going to give you independence, and that's a hard thing for people, I think, to wrap their head around that wealth is…”

“you can't just pick and choose bits of someone's life and say, I want his physique and her net worth, and I want his house. And like, you have to take the whole package. And a lot of the great things in anyone's life, there, there, there's a cost that came with that.”

“when you are lower, lower on the totem pole, it's very, it's easier for everyone around you to tell you what you're doing wrong. And the higher you gain, Particularly when you get up to the very high levels, no one wants to tell you doing wrong because you're probably paying those people to, to, to be surrounded, uh,…”

“getting rich and staying rich are completely different skills. And there's not that many people who are equally skilled in getting rich versus staying rich.”

“Money that you are given, that you inherit, can be a burden to your ambition, a burden to your identity of building a name for yourself.”

“you don't want the wealth that you pass your kids to burden them into a lifestyle that they don't want for themselves. You just want to be like, here's enough money so that you can have the leverage and the tools to find out who you want to be and live the life that you want, but not so much that it's going to burden…”

“at a lot of levels, there is social debt that comes with money. So, if you, at every level of net worth, like, if your net worth grows by one dollar, With that comes a couple pennies maybe of like social debt where you are like incentivized or like push towards to increase your lifestyle or to take care of other people…”

“And it's this thing of just, like, if your expectations shift, then the littlest thing can, can make you upset. It's like, when you go to the quiet car, yes, it is quieter, but you also have this, like, sound debt that comes with it, you could say. This invisible sound debt that is a liability now. And I think it's so…”

“If you raise your kids, even if you have a lower income, but you raise them with an obsession with money, To like, that's the scorecard of measuring other people. It's like, well, what's your net worth? What's your salary? That's why I'm going to measure you by and rank you by. That's when you get spoiled little jerks…”

“You don't need to sit your kids down and say, let me teach you about money. And in fact, if you do that, most kids are going to yawn and, and, and, and say, I'm not interested in this, but they are definitely paying attention to every time you say we can't afford this, they're, they're making a mental note of it. Every…”

“Don't think that all poverty is due to laziness and don't think that all wealth is due to hard work. It's not. If you are just ranking people by their net worth and ranking their value by the net worth, that's, that's probably the most dangerous thing you can do with money. It's the most profoundly wrong takeaway from…”

“There's always a pendulum between labor and capital. Workers and investors, and it kind of swings back and forth of who's taking the lion's share of the spoils in this, this economy. In the 19 twenties, it was capital. From the 19, probably fifties to seventies, it was labor. Uh, and, and since then it's been capital…”

“A lot of the reason that people don't like reading, why people don't read as much as they should, or if they say, ah, I'm, I'm, I'm not a big reader. A lot of the reason is because they feel like morally that they need to finish every book that they start. And we realize that the majority of books, there's four million…”

“So because it's just so much easier to remember a story than a statistic, and it's easier to contextualize it within your own life, and because there's so much emotion embedded in it, stories are like leverage for good statistics.”

“So having that level of constant feedback and doing that thousands of times over a decade will turn anyone into a much better writer than they were when they started.”

“I think in some ways you test ideas in Twitter and if they work, you can turn those ideas into a blog post. And if the blog post works, you can turn it into a book idea or a book chapter. That's kind of the natural progression for a lot of these things.”

“Even the best comedians, the world-class comedians, don't necessarily know what's funny until they've tested it. And this is why George Carlin, Chris Rock, Jerry Seinfeld, they test their new jokes in tiny clubs. Because even Chris Rock does not know what's funny until they've tested it, until he's tested it.”

“when you are vulnerable and open, people love it because even if you don't stutter, you're like, oh, I, I, I have this similar, I have this issue, whatever it would be. And like, thank you for telling me that your life was not as, was, was not perfect. Thank you for being open about the struggles that we all have in…”

“it's almost like an inverted pyramid where it's like people are most impatient in the first two sentences. And so you would think it'd be the other way around. They would get impatient after they've worked their way through your article and they're getting bored. Like, no, they're most impatient at the top.”

“there are, there are three types of, of writing, uh, especially financial writing. There is, uh, just providing information, which is, I guess what like Reuters and Bloomberg would do just breaking news and Just putting out the objective facts, end of story. And then, so that's one type. A second type is sharing…”

“You get huge skews between people who really like the article or people who really hate the article. Not a lot in between. I think feedback is only relevant if like a reader is forced to give it. So you get the biggest, The widest swath of opinions, but most feedback is going to be from the tiny skews on either end.”

“I think you will see that trait among a lot of the best investors and the smartest thinkers is that they take people who disagree with them more seriously than people who do agree with them.”

“maybe he's seven years early. Uh, which is indistinguishable from being wrong, I think.”

“there are analysts and economists who cling to positions that they know are wrong. They know in their head are wrong, but because of their career liability, their professional reputation, they, they don't want to change their mind out of fear of looking like a flip-flopper or out of fear of admitting that they were…”

“I think there's a, a paradox in that most fields, the more you do it, the better you get and the easier it gets. I think writing, especially writing about a single topic like investing, It's the other way around in that. So I've written 3600 articles now. So the low hanging fruit is long gone. And it's this weird thing…”

“What's definitely true, and I've heard this from other writers too, is that when you, is that when you sit down and try to force yourself to think about a topic, you're never gonna, you're never gonna get it. If you sit down and say, okay, I need to think about something What am I going to write? If you try to force…”

“So I think it's really important for anyone, whether you're doing this professionally or just, you're just, uh, you're just interested in finance. To have some filter, and the best way to have a filter is to find someone who you trust and let them be your filter.”

“I think at every point in history, there has been something, there have been two things, something that we were totally, 100% completely wrong about, and at the same time, a sense that we have figured everything out, and, you know, science, you know, we, we figured out, we figured out everything that's fundamental.…”

“I think if you could see inside of everyone's head and see their thoughts, um, you would see that people are a hundred times more anxious than you assumed. They're a hundred times funnier than you assumed. They're a hundred times more doubtful and depressed than you assumed. Like, I think in either direction, positive…”

“you gotta be very careful with decisions that are irreversible. They're gonna have lasting consequences. And be much less choosy and picky and analytical about decisions that are reversible and whatnot.”

“Loyalty to people who deserve your loyalty is a very rewarding thing. The important thing is people who deserve your loyalty, which is a small list. A lot of people do not deserve your loyalty. Uh, but loyalty to someone who deserves your loyalty is unbelievably rewarding.”

“finance is attractive to a yacht of, to a lot of, especially young men in their teenage years because it has the impression of money and power and prestige.”

“I think writing is a great process for anybody in any field because it really helps you solidify your thoughts.”