Wall Street Lies
Wall Street Lies was my means of pointing out the myths, the facts, and most importantly, the lies you’d hear every day. On TV, on the street, from your neighbors (most of whom didn’t know any better), and in many cases from your ‘adviser’.
One of the many things these guys would tell you is that, although what you do matters considerably, when you do it isn’t really all that important. Most of them, then and now, would have you believe that timing the market is impossible anyway – so why lie awake at night trying to figure out how to do something that can’t be done? “You can’t time the market” remains as one of the biggest of all the Wall St. Lies.
If you’ve lost lots of money on good companies which have been successful, or will at least at times be successful, you already know what a foolish idea that is. The truth is you’d better time the markets. I for one am doing my best to seek good timing in everything I do during my remaining 8,000-odd days left on this planet.
Those so-called experts would also suggest that you rely on diversification to keep you safe. This means just invest in a little of everything, instead of choosing the place to use your financial power. I don’t think that idea ever made sense, but when the entire market was on the rise and everything was going up together, it made a good story, and it justified assuming risk without knowing exactly what you were doing.
Presumably that also made it alright to rely for advice on people who didn’t know much about investing. You probably don’t need an expose on that idea at this point, because so much money has recently been lost by good, intelligent people who were lulled into believing they were safe. They figured they were diversified, and didn’t have to be aware of the world changing around them.
But the world has changed gradually and imperceptibly each day. We reached a tipping point and all the markers for carelessness, arrogance, hubris, excessive risk, insensitivity to timing – they all came due at the same time. It was as if suddenly someone shouted “FIRE!” on a crowded planet and everyone in the world ran for the exits at the same time, catching most investors completely off guard - and doing away with decades of savings.
*Excerpts from "A World without Borders" by Dan Frishberg
