Thread by @MazwoodCap

Big fan of @morganhousel.

Big fan of his new book, "The Psychology of Money."

I collected my favorite lines from each of his 20 chapters.

mazwoodcap.substack.com/p/an-unbook-re…

I also abbreviated them for Twitter below ⬇️⬇️!

Go!

Ch1, P19
"Few people make financial decisions purely with a spreadsheet. They make them at the dinner table or in a company meeting. Places where personal history/own unique view of the world, ego, pride, marketing, & incentives are scrambled into a narrative that works for you."

Ch2, P28
"Luck and risk are both the reality that every outcome in life is guided by forces other than individual effort. They are so similar that you can’t believe in one without equally respecting the other."

Ch3, P41
"Modern capitalism is a pro at 2 things: generating wealth & generating envy. Perhaps they go hand in hand; wanting to surpass your peers can be the fuel of hard work. But life isn’t any fun w/o a sense of enough. Happiness... is just results minus expectations."

Ch4, P53
"Good investing isn’t necessarily about earning the highest returns, because the highest returns tend to be one-off hits that can’t be repeated. It’s about earning pretty good returns that you can stick with and which can be repeated for the longest period of time."

Ch5, P60
"Getting money requires taking risks, being optimistic, and putting yourself out there. But keeping money requires the opposite of taking risk. It requires humility, and fear that what you’ve made can be taken away from you just as fast."

Ch6, P73
"Anything that is huge, profitable, famous, or influential is the result of a tail event—an outlying one-in-thousands or millions event. And most of our attention goes to things that are huge, profitable, famous, or influential."

Ch7, P84
"Money’s greatest intrinsic value—and this can’t be overstated—is its ability to give you control over your time. To obtain...a level of independence and autonomy that comes from unspent assets that give you greater control over what you can do and when you can do it."

Ch8, P94
"It’s a subtle recognition that people generally aspire to be respected and admired by others, and using money to buy fancy things may bring less of it than you imagine. If respect and admiration are your goal, be careful how you seek it."

Ch9, P98
"Singer Rihanna nearly went bankrupt after overspending and sued her financial advisor. The advisor responded: 'Was it really necessary to tell her that if you spend money on things, you will end up with the things and not the money?'"

Ch10, P109
"The ability to do those things when others can’t is one of the few things that will set you apart in a world where intelligence is no longer a sustainable advantage. Having more control over your time and options is becoming one of the most valuable currencies in 🌎"

Ch11, P113
"Do not aim to be coldly rational when making financial decisions. Aim to just be pretty reasonable. Reasonable is more realistic and you have a better chance of sticking with it for the long run, which is what matters most when managing money."

Ch12, P123
"It is smart to have a deep appreciation for economic and investing history. History helps us calibrate our expectations, study where people tend to go wrong, and offers a rough guide of what tends to work. But it is not, in any way, a map of the future."

Ch13, P139
"Margin of safety—you can also call it room for error or redundancy—is the only effective way to safely navigate a world that is governed by odds, not certainties. And almost everything related to money exists in that kind of world."

Ch14, P150
"Imagining a goal is easy and fun. Imagining a goal in the context of the realistic life stresses that grow with competitive pursuits is something entirely different."

Ch15, P162
"It sounds trivial, but thinking of market volatility as a fee rather than a fine is an important part of developing the kind of mindset that lets you stick around long enough for investing gains to work in your favor."

Ch16, P173
"Few things matter more with money than understanding your own time horizon and not being persuaded by the actions and behaviors of people playing different games than you are."

Ch17, P180
"When you realize how much progress humans can make during a lifetime in everything from economic growth to medical breakthroughs to stock market gains to social equality, you would think optimism would gain more attention than pessimism. And yet."

Ch18, P195
"Investing is one of the only fields that offers daily opportunities for extreme rewards..."

Ch19, P208
"If you want to do better as an investor, the single most powerful thing you can do is increase your time horizon. Time is the most powerful force in investing. It makes little things grow big and big mistakes fade away..."

Ch20, P215
"Being able to wake up one morning and change what you’re doing...seems like the grandmother of all financial goals. Independence doesn’t mean you'll stop working. It means you only do the work you like w/ people you like at the times you want for as long as you want."

Congratulations to @morganhousel. Great book with takeaways for all of us.

Hope you enjoyed this "unbook" review/sneak peak.

The full version is here. And don't forget to sign up for Musings by Mazwood if you're new here!

Thank you 🙏

mazwoodcap.substack.com/p/an-unbook-re…