Posts filed under “Rules”

Non-Political Lessons from 2012 Election


On Wednesday, I jotted down a few takeaways from the election that were applicable to investors and people running businesses. Really, it was for any one with an interest in learning from the misstep of others.

I liked the idea so much I decided to expand it for my Sunday Washington Post Business Section column. It was not about schadenfreude; rather, this is an inexpensive form of tuition, letting other organizations make strategic, cognitive and tactical errors that you can learn from. These include both of the candidates, the media, the consultants, the GOP primary candidates, some of the major memes of the campaign, a bit of philosophy, and a few words about money.

Called simply Lessons from 2012 Election, it discusses the various non-political lessons that can be derived from the entire season and applied to investors and business leaders.

Here are the 10 :

Lessons from 2012 Election

1. Process, not outcome, is what matters
2. Do your homework and practice
3. Think deeply before you speak
4. Avoid clichés
5. Don’t live in a bubble
6. Have influential allies
7. Be true to yourself
8. Choose your business partners well
9. It takes more than money
10. It helps to make your own luck

Note the focus is Non-Political lessons; I will let the politicos handle the specific getting elected related takeaways themselves. >

I still cannot access the print version, so if anyone can send me a PDF of G6, it would be appreciated. I’d like to see what the Post did with the dead tree version of it.>


Lessons from the 2012 election
Barry Ritholtz
Washington Post, November 11, 2012

Category: Apprenticed Investor, Rules

Lessons from 2012 Presidential Election

I am always on the look out for lessons that I can apply to investing and business. This post-election morning is not any different. Let’s take a look at some of the more interesting aspects of the election season, and try to discern what lessons there are, for investors and others to learn: 1. Process…Read More

Category: Investing, Philosophy, Rules

Economists: Things We Are Ignorant About

Economists have been stumped by the past dozen years.

The Dotcom collapse was an early warning that economists, as a class, were not clued in. Sure a handful recognized that there were budding problems — think Bob Shiller — but he was notable as an exception.

Then we had the entire debacles of 2000s – derivative implosion, housing collapse, credit crisis, market crash — and we found that the vast majority of economists are academic theorists who were completely blindsided by events in the real world. And those were the good ones, as opposed to the biased hacks whose goals have nothing to do with discerning objective reality.

We need to admit that Economists, as a profession, are stumbling around in the dark.

To quote  Edward Hadas, “Policymakers and pundits still make confident pronouncements, but the conclusions are radically different. The expert disagreements give away the truth: ignorance reigns.”

Hadas identifies six questions which professionals should stop pretending they can answer:

1) What creates retail inflation?
2) How do financial asset prices affect the real economy?
3) Do big fiscal deficits damage the economy?
4) What does quantitative easing actually do?
5) How much leverage is too much?
6) How to deleverage without damaging the economy?

If economists cannot explain the basic workings of the economy, perhaps we should be relying on them much less for policy advice . . .


Admit economic ignorance
By Edward Hadas
Reuters, October 31, 2012

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Category: Economy, Really, really bad calls, Rules

Rosie’s Rules to Remember (an Economist’s Dozen)

Yet another rule to add to our ongoing collection. This one comes from Economist David Rosenberg, formerly Merrill Lynch’s chief dismal scientist, now at Gluskin Sheff: 1. In order for an economic forecast to be relevant, it must be combined with a market call. 2. Never be a slave to the date – they are…Read More

Category: Rules

Morgan Housel’s 9 Financial Rules

Another set of instructive rules for investors, this one from Morgan Housel: 1. Nine out of 10 people in finance don’t have your best interest at heart. 2. Don’t try to predict the future. 3. Saving can be more important than investing. 4. Tune out the majority of news. 5. Emotional intelligence is more important…Read More

Category: Investing, Rules

10 Lessons from 1987 Market Crash

Nice set of rules from Wallace Witkowski of MarketWatch: 10 lessons from the market crash of 1987 1. Stay objective when others get emotional 2. Be like Buffett: Buy on the fear, sell on the greed 3. Make a crash shopping list 4. What goes up fast comes down faster 5. There’s no such thing as…Read More

Category: Investing, Psychology, Rules

(Not so) Golden Rules About Investing (& Not Investing)

After last week’s Rules frenzy, Cassandra Does Tokyo sent this in. Enjoy: ~~~ Trolling the blogosphere, it seems to be the season for sharing one’s so-called Golden Rules of Investing. So here goes…   Cassandra’s 25-3/4 (or so) Tungsten-Filled Golden Rules #25-3/4. Do as I do – not as I say – but do it…Read More

Category: Humor, Rules

WaPo: Ritholtz’s Rules of Investing

> My Sunday Washington Post Business Section column is out. This morning, we look at Ritholtz’s rules of investing. The dead tree edition has the headline Think like a contrarian: Ritholtz’s rules of investing. We have 6 rules today, and 6 more rules next week: 1 Cut your losers short and let your winners run…Read More

Category: Apprenticed Investor, Investing, Rules

Sir John Templeton 16 Rules For Investment Success

Interesting set of rules from legendary investor John Templeton:

1. Invest for maximum total real return
2. Invest — Don’t trade or speculate
3. Remain flexible and open minded about types of investment
4. Buy Low
5. When buying stocks, search for bargains among quality stocks.
6. Buy value, not market trends or the economic outlook
7. Diversify. In stocks and bonds, as in much else, there is safety in numbers
8. Do your homework or hire wise experts to help you
9. Aggressively monitor your investments
10. Don’t Panic
11. Learn from your mistakes
12. Begin with a Prayer
13. Outperforming the market is a difficult task
14. An investor who has all the answers doesn’t even understand all the questions
15. There’s no free lunch
16. Do not be fearful or negative too often


Complete explanation after the jump



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Category: Investing, Rules

Investing & Trading Rules, Aphorisms & Books (Fall 2012)

Back in 2011, I pulled together a full run of Trading Rules & Aphorisms.

It turned out to be a worthwhile exercise, and so I began updating this semi annually. This is a list of my favorite traders, analysts, economists and investors views’ on what to do — and what not to do — when it comes to markets.

This is the latest updated version of my:

Trading & Investing Rules, Aphorisms & Books

Livermores Seven Trading Lessons

Bob Farrell’s 10 Rules for Investing

James Montier’s Seven Immutable Laws of Investing

Richard Rhodes’ 12 Trading Rules

John Murphy’s Ten Laws of Technical Trading

Six Rules of Michael Steinhardt

• David Merkel: The Eight Rules of My Investing

Art Huprich’s Market Truisms and Axioms


Lessons from Merrill Lynch

Louis Ehrenkrantz’ 7 Golden Rules for Investing

Rosie’s Rules to Remember

In Defense of the “Old Always” (Montier)

Lessons Learned from 37 Years of Futures Trading

Richard Russell’s The Power of Compounding

The golden rules of investing (India)

25 Common Sense Money Tips


If you have any suggestions for any good lists of rules I may have missed, please link to them in comments. If they are worthy, they will get added tot he list.

After this run, I plan on updating this list 2x per year . . .


My own trading rules and favorite Trading Books are after the jump

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Category: Investing, Rules, Trading