A Rich Life

The Old Ideas on Saving & Investing Don't Work -- Here's What Does

Podcast #95 — Risk Tolerance in the Real World

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I’ve added Podcast #95 to the “RobCasts” section of the site. It’s called Risk Tolerance in the Real World.

Trying to psychoanalyze yourself is a waste of time. Don’t look inward to determine how much risk you can afford to take on, look outward. The reality is that stocks are far more risky at times of insane prices. Cutting back on stocks at such times allows you to avoid the worst that the market can dish out while earning far higher returns (compounding applies to the money you save by not being overinvested in stocks during a price crash).

Comments

  2. Thank you for those kind words, John.

    My favorite line was the line about “Morning Snowflake — Part Two.” Something about that “Morning Snowflake” title tickles me.

    Rob

  3. I hope I didn’t just get myself into trouble with any morning snowflake lovers.

    Yikes!

    Rob

  4. We need you new book badly. [Investing for Humans.]

    Somebody must protect the inexperienced investor. Right now, they are in the hands of Passive Investors. Ouch!

    What is worse, judging from “Today’s Passion,” the Passive Investors are aggressively promoting bad advice. They actually believe it.

    Have fun.

    John Walter Russell

  5. the Passive Investors are aggressively promoting bad advice. They actually believe it.

    I think that’s right. John.

    They know that their ideas cannot be defended in civil and reasoned debate. But they believe in them all the same.

    That’s the problem that we all (this includes the Passives, of course) need to work together to overcome.

    I believe that the answer lies in developing a sense of humor. The Passives need to learn not to take themselves so seriously.

    All sorts of wonderful things follow from that.

    Rob

  7. Thanks for asking, Bob.

    I believe that we need to see a national debate on the flaws in the Passive Investing model. The story of the lead-up to the national debate and the story of what comes out of the national debate is part of the story that I want to tell in the book.

    There is still today a good bit of resistance to the idea of having the national debate. So my guess is that it is going to be some time yet before the book appears.

    I have given up trying to make precise predictions about any of this. It is too crazy to be predictable.

    Rob