Investing is all about the long-term ownership of businesses. Speculation is precisely the opposite. It is all about the short-term trading, not long-term holding, of financial instruments—pieces of paper, not businesses—largely focused on the belief that their prices, as distinct from their intrinsic values, will rise.

Therefore, as I wrote in my Little Book of Common Sense Investing, “the stock market is a giant distraction from the business of investing.”

The message is clear: In the long run, stock returns have depended almost entirely on the reality of the relatively predictable investment returns earned by business.

It’s not money that determines our happiness, but the presence of some combination of these three attributes:

It is economics that controls long-term equity returns; the impact of emotions, so dominant in the short term, dissolves.

Keynes defined investment - he called it “enterprise” - as “forecasting the prospective yield of an asset over its entire life.” He defined speculation as “the activity of forecasting the market.”

Albert Schweitzer got it exactly right. “Success is not the key to happiness. Happiness is the key to success.”

(1) autonomy, the extent to which we have the ability to control our own lives, “to do our own thing”

In the very long run, all of the returns earned by stocks are created not by speculation but by investment.