Reading about Investing
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John Bogle The Little Book of Common Sense Investing 5/10 |
Ever want to feel like scum, sleaze, or perhaps just a good old fashioned greed head. If so pick up a book about investing. It’s not so much that investment books are bad. But thinking about yourself reading one is bad, each turn of the page brings on another shank of self-loathing to the guts.
It is almost tragic, the way I see it these are the options one has when managing their savings:
1) Stash your money under your mattress
2) Save your money in a Bank
3) Invest your own money and invest in other people
4) Start a business and invest your money in yourself
Since I’m not about to become a hermit number 1 is pretty much out. And since I am not about to become an entrepreneur any time soon #4 is outski as well.
So basically, for now, it comes down to going with the Banks or going by yourself. And if you want to go by yourself, would it not be unwise to acquire some knowledge about what you are getting yourself into. Unfortunately, acquiring said knowledge does not come without obstacles.
The first of these obstacles is tedium. Pages upon pages filled with charts all pointing up (Except in the 30’s and late 90’s), cost/earnings analysis, histograms, and all sorts of phrases that will have you running to Investopedia. It requires a bit of discipline and dedication, even if the book is only ~200 pages with big fonts. It is the essence of boredom.
If one manages to sacrifice some leisure time and commit to the book, the next obstacle is worry. Every Investment Book I am sure will plant about a 1000 seeds of the very doubt that they are trying to guide you through. Are you putting your money in the right places? Are you saving enough money? Maybe you shouldn’t buy anything ever? Why aren’t you using this “strategy”? What about your kids (???!!!seriously???!!)? The list goes on and on. And if you begin to think about it too much it could crush you. While reading about a “good idea” is easy, thinking about how you are going to put that into practice for yourself sucks.
After spending a bit of time with the book you may then come to the next obstacle. This one is the feeling that the author really and truly knows just about as much as everyone else…nothing. In this case John Bogle points to charts and and graphs and mounds of historical to ra-ra his case for indexing, and poo-poo managed funds. Then will damn every managed fund who uses historical data to measure performance, because past returns are no indication of future returns. Uh? but wasn’t that the reasoning he just used? The hypocrisy is unavoidable though, the vast majority of people will use past performance as an indicator when choosing stocks, funds, cars, shoes, movies, batteries, and even restaurants. It is how people work. In addition to this the word “luck” is mentioned far to many times to make you think that anybody in the investment business ever has a grasp on it.
Finally when it is all said and done there is your conscience to wrestle with at the end. Or maybe not. I have spent a fair portion of my life shit talking capitalism, globalization, corporate injustice, and all that other sweet candy “Die Hard Socialists When Drinking Beer And Having A Chat, But Maybe Don’t Live To The Fullest”, like myself, love to rap to. When the time comes to put your money behind something, and you start thinking about things from an ethically responsible standpoint, questions come up… And while to avoid delving to deep into this, because I’ll end up with hives, I will end off with my current reasoning in regards to the ethical dilemma of investing.
All Bank/Financial managed Investments give you little control over which Corporations get your money.
Ethical Funds are heavily invested in banks, so they are basically just a layer of abstraction over unethical choices.
Taking ownership of your investments, you will at least be able to see where your money is, and be able to wholly take responsibility for it.
This was not much of a book review, save yourself the 24$, John Bogle says “Index Funds Rule!”. Mostly because of lower costs.
Side Note in a Similar Vein: Google Finance has updated, and you can now add TSE Stocks to your portfolio, where you couldn’t before. Bout Time.