Jason Zweig

Recommended reading, economic debates, predictions and opinions.
Flaccidsteele
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Re: Jason Zweig

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The Irrelevent Investor wrote:Since turnover is negatively correlated to investment performance, no post that stand the test of time will include trade setups or forecasts. In my writing, nothing is particularly actionable, but hopefully it is thought provoking because for 99% of investors, more good comes from thinking then from acting.
I don't know much about the "Irrelevant Investor", but the ideas remind me of the various Charlie Munger and Warren Buffett quotes that I've read over the last 3 decades.
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"Once you have ordinary intelligence, what you need is the temperament to control the urges that get other people into trouble in investing." - W.B.

"A lot of people with high IQs are terrible investors because they’ve got terrible temperaments." - C.M.

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Re: Jason Zweig

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A rehash of a number of other articles that he's posted but still worthy of reading and contemplating -- Some of the Wisest Words Ever Spoken About Investing | Jason Zweig
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Re: Jason Zweig

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I also give thanks to Mr. Bernstein for teaching me that wealth is a loan, not a gift, from the markets. A few months of a bear market can claw away all the gains you pile up over years of bull markets. Finally, Mr. Bernstein never tired of emphasizing that we can never know the future — least of all at the very moments when it seems most certain.
This passage is from your link so how are you supposed to make money?
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Re: Jason Zweig

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BRIAN5000 wrote:
I also give thanks to Mr. Bernstein for teaching me that wealth is a loan, not a gift, from the markets. A few months of a bear market can claw away all the gains you pile up over years of bull markets. Finally, Mr. Bernstein never tired of emphasizing that we can never know the future — least of all at the very moments when it seems most certain.
This passage is from your link so how are you supposed to make money?
The full context (with my bold)
Jason Zweig wrote:From the economist and investing writer Peter Bernstein, who died in 2009, I learned about Pascal’s wager: You must weigh not only the alluring probabilities of being right, but the dire consequences of being wrong.

I also give thanks to Mr. Bernstein for teaching me that wealth is a loan, not a gift, from the markets. A few months of a bear market can claw away all the gains you pile up over years of bull markets. Finally, Mr. Bernstein never tired of emphasizing that we can never know the future — least of all at the very moments when it seems most certain.
I think the first part about Pascal's wager is important but the last part I've bolded is critical.

As to how you make money? You educate yourself and do your homework and access your choices with probabilities in mind. That should keep you from risking the mortgage money for the next "sure thing" IPO or penny stock. Think of the dire consequences of being wrong.
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Re: Jason Zweig, The Intelligent Investor

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A timely article What Benjamin Graham Would Tell You to Do Now: Look in the Mirror - WSJ
Jason Zweig wrote:Forget about what the stock market is going to do. Instead, focus on what you, as an investor, ought to do.

That advice from Benjamin Graham, the great investment analyst and Warren Buffett’s mentor, can help you navigate the market’s latest storm. Should you jettison some stock or stay the course? How should you act now to reduce the odds that you will kick yourself later for taking too much risk or too little? A few of Graham’s guidelines can help you know yourself and act accordingly.

In his writings, including the classic book after which this column is named, Graham laid out basic distinctions that should guide your behavior.

First, determine whether you are an investor or a speculator. “The investor’s primary interest lies in acquiring and holding suitable securities at suitable prices,” Graham wrote. The speculator, on the other hand, cares mainly about “anticipating and profiting from market fluctuations.”

If you’re an investor, “price fluctuations have only one significant meaning,” according to Graham: “an opportunity to buy wisely when prices fall sharply and to sell wisely when they advance a great deal.”
The whole article is well worth reading, although it is mostly a timely re-hash of sections of the Graham's excellent book, The Intelligent Investor, which Zweig added commentary for the 4th edition (2003).

For those who cannot get behind the WSJ paywall to read the article, another way in might be via Zweig's website, What Benjamin Graham Would Tell You to Do Now: Look in the Mirror | Jason Zweig
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Re: Jason Zweig

Post by Peculiar_Investor »

Mr. Zweig is among my favourite reads.

Once again he's offered a worthy read We Can’t Prevent Market Panics. We Can Control How We React. - WSJ (paywall?)

The subtitle is "The dangers lurking in the market can be hidden or delayed, but never eliminated. For investors, slumps are a chance for introspection–and, sometimes, new opportunity."
Jason Zweig wrote:Until recently, many investors believed central banks and other policy makers had repealed the business cycle and that making money in the stock market was something you could take for granted—in much the same way that science and technology seemed to have beaten back diseases that had been the scourge of humanity for millennia.

Maybe investors a century ago and more had a wiser view. They believed the world was governed by unseen, omnipresent powers that could be appeased but never controlled—and that financial panics were a form of divine retribution for the sinful excesses of prosperity.

We shouldn’t regard market panics as quaint artifacts from the days of ticker tape and trading by telephone. Rather, they are forces that can be hidden or delayed but never eliminated. And believing that panics have become obsolete is a precondition for their recurrence.

The modern history of financial markets is a chronicle of attempts to control risk—if not eliminate it. One after another, they have all failed.
For those of us who've been through a number of these events, such as Black Monday (1987), the dot-com collapse, the financial crisis, and others I've long forgotten can attest to these failed attempts to control risk.
Jason Zweig wrote:So ask yourself: Have I been taking more risk than I realize? Conversely, how should I turn panic into opportunity? How can I improve my portfolio and restore a sense of control? Should I sell some stocks or funds to generate a tax loss I can use to offset gains or income? Do I have long-held mediocre or risky stock positions I’ve been reluctant to dump until now because that would have generated a taxable gain I’d no longer incur at today’s prices?

Blind faith in tools for controlling financial risk has never made sense. If risk could ever be eliminated, investors would immediately turn so euphoric that they would drive the prices of financial assets sky-high— thereby creating an enormous new risk out of the absence of all the old ones.

Investors should never stop trying to manage their risks. But they should never believe that they, or anyone else, can eliminate them.
Worth pondering, particularly in light of recent events. Maybe the correct answer for some (many?) is stay the course. Based on posts that I'm reading here on FWF that would seem to largely the case for those that have been around for a while. But that doesn't mean be complacent. You can always learn, because each event has some different characteristics and learning opportunities.

What are your blind spots? Has your faith in your strategy, the function of your investment vehicles (i.e. fixed income ETFs) or financial institution (overloaded and hard to reach) been tested. Have you given consideration to what you've now learned?
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Re: Jason Zweig

Post by hamor »

I like Zweig, nothing new in the quotes, but thanks for the reminder.
The modern history of financial markets is a chronicle of attempts to control risk—if not eliminate it. One after another, they have all failed.
Right. I am a big fan of Taleb (NNT) and I encourage everyone to read him, although some find him obnoxious. His manner should not detract from the message.
All these suits in banks (private and government) have no idea what they're doing when it comes to what NNT calls 'fat tails'.
And if they do, they coudln't care less because of no 'skin in the game', when they screw up, they are bailed out and richly rewarded with taxpayers money (e.g. bonuses in Financial Industry after 2008).

Here's the most recent from NNT, as I mentioned elsewhere he predicted (to a degree) the current situation.
https://medium.com/incerto/corporate-so ... 31a67bff4a
"Speculation is an effort, probably unsuccessfully, to turn a little money into a lot. Investment is an effort, which should be successful, to prevent a lot of money from becoming a little." Fred Schwed " Where are the Customers’ Yachts?"
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