Jason Zweig: Saving Investors from Themselves – North Star Podcast

Key Takeaways

  • One of Charlie Munger’s favorite business principles – “Figure out what works and then do it over and over again”
  • Welcome negative feedback and actively seek to destroy your own ideas
    • It takes a lot of commitment, mental effort ,and struggle to arrive at what feels like a conclusion… but that doesn’t mean you should stick with it – because there’s always the possibility that you are wrong
  • The similarity between investing and dieting – they’re both simple, but not easy
    • To be a good investor – “All you do is diversify, keep your costs low, and minimize trading. That’s pretty much it.”
    • With dieting – just eat less and exercise more (which is harder than it sounds)

Intro

Books Mentioned

Find What Works and Keep Doing It

  • Charlie Munger, one of the greatest investors of our time and Warren Buffett‘s business partner, is a fan of the principle – “Figure out what works and do it over and over again”
    • Similarly, Jason Zweig describes his job as repeating the exact same finance advice in such a way that “neither my editors nor my readers will notice I’m repeating myself”
      • Why?
        • “I think there’s only a handful of things that are true. And when you try to sort of expand beyond that set, you quickly get into the position of starting to tell people things that are bad for them. So I’ve willingly put myself in a box.”
          • One piece of advice Jason repeats often – Sell when the market is high and buy when the market is low

Kill Your Ideas

  • Both Charlie Munger and Daniel Kahneman love to destroy their own ideas
    • “It’s really important to get that kind of negative feedback and to welcome it and really be open to it, not just as a writer, but as a thinker and as a person”
      • It takes a lot of commitment, mental effort ,and struggle to arrive at what feels like a conclusion… but that doesn’t mean you should stick with it – because there’s always the possibility that you are wrong

Advice for Writers

  • As a writer, it’s important to refresh your brain and engage in things outside of work that are different than what you’re writing about from 9-5 (or whenever you write)
    • Instead of reading finance books, Jason prefers classic novels, history, biographies, science, and philosophy
  • It’s much better to be criticized for something that’s good, than be praised for something that’s bad
    • “It’s not easy, being criticized is hard. But the ability to go through a writing life with a thick skin is I think the only way you can get better.”
  • As a writer, avoid cliches – people have heard them a million times
    • Aim to instead put a new spin on things so it gives readers a different perspective of a familiar topic
    • Check out Jason’s 3 part guide, “On Writing Better”, for more writing tips
  • The book Look Homeward, Angel by Thomas Wolf, inspired Jason to become a writer
    • “It’s a wonderful novel”
  • When people criticize the messenger, discount it, but when people criticize the facts, that’s when you should stop what you’re doing and reread the research and make sure you didn’t make any mistakes
    • “Anytime somebody says I’m wrong, I have to take it seriously instead of taking it as an insult or an invitation to a pissing match. It’s not about winning. It’s about learning.”

Investing Advice

  • Warren Buffett likes to say investing is simple but not easy (the same goes for things dieting)
    • “All you do is diversify, keep your costs low, and minimize trading. That’s pretty much it. It’s like eat less , exercise more.”
    • People are usually their own worst enemy because when they should be cautious, they tend to take on risk
    • The more you can do to automate how your investments behave, the more effective you can be in eliminating your own behavior from the equation

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