updated 7mo ago
The Psychology of Money
- The big takeaway from ice ages is that you don’t need tremendous force to create tremendous results.
from The Psychology of Money by Housel Morgan
Out of more than 21,000 venture financings from 2004 to 2014: 65% lost money. Two and a half percent of investments made 10x–20x. One percent made more than a 20x return.
from The Psychology of Money by Housel Morgan
- The ability to do what you want, when you want, with who you want, for as long as you want, is priceless. It is the highest dividend money pays.
from The Psychology of Money by Housel Morgan
2018, Amazon drove 6% of the S&P 500’s returns. And Amazon’s growth is almost entirely due to Prime and Amazon Web Services, which itself are tail events in a company that has experimented with hundreds of products, from the Fire Phone to travel agencies. Apple was responsible for almost 7% of the index’s returns in 2018. And it is driven overw
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Room for error lets you endure a range of potential outcomes, and endurance lets you stick around long enough to let the odds of benefiting from a low-probability outcome fall in your favor. The biggest gains occur infrequently, either because they don ’t happen often or because they take time to compound.
from The Psychology of Money by Housel Morgan
- Studying a specific person can be dangerous because we tend to study extreme examples—the billionaires, the CEOs, or the massive failures that dominate the news—and extreme examples are often the least applicable to other situations, given their complexity.
from The Psychology of Money by Housel Morgan
- There is no reason to risk what you have and need for what you don’t have and don’t need.
from The Psychology of Money by Housel Morgan
- John Stuart Mill wrote in the 1840s: “I have observed that not the man who hopes when others despair, but the man who despairs when others hope, is admired by a large class of persons as a sage.”
from The Psychology of Money by Housel Morgan
- Bubbles aren’t so much about valuations rising. That’s just a symptom of something else: time horizons shrinking as more short-term traders enter the playing field.
from The Psychology of Money by Housel Morgan
- Another is that pessimists often extrapolate present trends without accounting for how markets adapt.
from The Psychology of Money by Housel Morgan