POOR HENRY
Taking big risks is more likely to make you feel like a swaggering gambler, someone who’s “not afraid to risk it all on a roll of the dice.”
If you search for Gribbohm’s picture on Google, you’ll see that he’s a tough-looking guy. You can imagine him giving in to pressure to “act like a man.” Men don’t refrain from action. Men act. They take dramatic and constant action. When the going gets tough, the tough get – you get the picture. People think “doing something” is always the answer. Nobody thinks doing nothing is the answer. On the flip side, the actions that keep you from losing your life savings at the carnival and in the market will certainly not impress other tough guys, nor attract women looking for tough guys. Taking big risks is more likely to make you feel like a swaggering gambler, someone who’s “not afraid to risk it all on a roll of the dice.” It’ll at least attract a fair amount of attention. Gribbohm got plenty of that! Fear is the dominant emotion in the market at all times. When it appears greed has taken over, it’s really just the fear of being left out. That fear drives people to constantly seek action. The final mistake Gribbohm made was not knowing how far he was going to go. Gribbohm’s story shows you how crazy financial decisions can get, especially when speculating on great financial gain. He lost because he couldn’t trust himself. He didn’t decide beforehand how he would behave if presented with a game like Tubs of Fun. What will you do if the stock market falls?
What are your goals? I can’t really answer any of those questions, but I can tell you what I’ll do... I’m a dedicated lifetime buyer of equities. I do what I believe is enough homework to know which stocks to buy and which ones to avoid. Other things being equal, when the market falls, I buy more of what I like, same as I do when chocolate-chip cookies go on sale at the grocery store. I want more cookies, so I like it when my money buys more of them. I like equity returns, too, so I really like it when my dollar buys bigger ones. Every stock investor faces a huge list of unknowns. You’re not in control of stock prices or interest rates or tomorrow’s headlines. You must make your own behavior in the stock market the most solid, reliable of known entities. You must be in control of yourself. At any point during his incredible losing streak, Gribbohm could have wised up and walked away... but he didn’t. Many investors are making the same mistakes he did. If you’re one of them, wise up and walk away. And before you come back, make sure you learn the game you’re playing.
50
December 2019
Made with FlippingBook Publishing Software