🐈

"we are taught about money in ways that are too much like physics (with rules and laws) and not enough like psychology (with emotions and nuance)."

"your personal experiences w/ money make up maybe 0.0000001% of what's happened in the world, but maybe 80% of how you think the world works."

"The challenge for us is that no amount of studying or open-mindedness can genuinely recreate the power of fear and uncertainty."

"Studying history makes you feel like you understand something. But until you've lived through it and personally felt its consequences, you may not understand it enough to change you behavior."

Combining a bunch of quotes into: People make decisions based on what fits their narrative of the world b/c their narrative of the world IS their entire understanding of the world.

Assorted dates on newness of things: 401k created in 1978 Roth IRA in 1998 index funds < 50 yrs old hedge funds < 25 yrs old widespread credit usage only post WWII

we know luck exists but: "attribute [others] success to luck makes u look jealous and mean... and when judging yourself, attribute success to luck can be too demoralizing to accept."

"Be careful who you praise and admire. be careful who you look down upon and wish to avoid becoming." "focus less on specific individuals and case studies and more on broad patterns."

"the more extreme the outcome, the less likely you can apply its lessons to your own life, because the more likely the outcome was influence by extreme ends of risk and luck."

"to make money they didn't need they risked what they did have and did need. and that's foolish. if you risk sth that is important to you for sth that is unimportant to you, it just does not make any sense."

"'Enough' is realizing that the opposite - an insatiable appetite for more - will push you to the point of regret." "The only way to know how much food you can eat is eat until you are sick. For some reason this same logic doesn't translate to business and investing."

chapter on positive feedback loops and compounding: "you don't need tremendous force to create tremendous results." (most of Buffet's wealth was gained when he was old. 84.2B of 84.5 was accumulated post-50s, 'his secret is time')

"if u were a tech optimist in the 1950s u might have predicted that storage would become 1000 times larger, maybe 10,000. few would have said "30 million times larger within my lifetime" but that's what happened."

the danger is to ignore compounding as a strategy and chase gains. the real secret is pretty good returns u can stick with for a long time.

"but keeping money requires the opposite of taking risk. it requires humility, and fear. it requires frugality and an acceptance that at least some of what you've made is attributable to luck."

"a plan is only useful if it can survive reality. and a future filled with unknowns is everyone's reality." "many bets fail not b/c they were wrong but b/c they were mostly right in a situation that required things to be exactly right."

"paranoid and optimistic at the same time is hard to maintain b/c seeing things as black & white takes less effort than accepting nuance. but you need short-term paranoia to keep you alive long enough to exploit long-term optimism."

"the great art dealers operated like index funds. they bought it in portfolios, not individual pieces they happened to like. then they sat and waited for a few winners to emerge." "it is not intuitive that an investor can be wrong half the time and still make a fortune."

"tails drive everything. the distribution of success among large public stocks over time is not much different than it is in venture capital."

"40 percent of the Russell 300 stock components lost 70% of their value and never recovered. Effectively all of the index's overall returns came from 7% of component companies. That's the kind of thing u'd expect from venture capital. But it's what happened inside a boring index"

"the decisions that you make today or tomorrow or next week will not matter nearly as much as what you do during the small number of days - likely 1% of the time or less - when everyone else around you is going crazy."

"having a strong sense of controlling one's life is more dependable predictor of positive feelings of wellbeing than any of the objective conditions of life we have considered." (FYI being BOSS often means LESS control b/c ppl r difficult)

"and I wanted to work hard. But doing something you love on a schedule you can't control can feel the same as doing something you hate." "Psychologists call it reactance."

"Part of what's happened [in the US] is that we've used our greater wealth to buy bigger and better stuff. But we've simultaneously given up control over our time."

"but they did know I did not care about them, or even notice them? Did they know I was only gawking at the car, and imagining myself in the driver's seat?" (luxury goods are about PAYING to be walking billboards)

"When most people say they want to be a millionaire, what they actually mean is "I'd like to spend a million dollars." and that is literally the opposite of being a millionaire."

"one of the most powerful ways to increase your savings isn't to raise your income. It's to raise your humility." "ppl w/ enduring personal finance success tend to have a propensity to not give a damn what others think of them."

(not the interesting "not give a damn" interplay with "humility" above. arrogance is mostly about entitlement, to NOT have but think you SHOULD have.)

"savings w/o a spending goal gives u options and flexibility, the ability to wait and the opportunity to pounce. It gives you time to think. It's lets you change course on your own terms." POUNCE POUNCE POUNCE POUNCE POUNCE!

"every bit of savings is like taking a point in the future that would have been owned by someone else, and giving it back to yourself."