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Re: Anyone see Scott Burns column yesterday ? *
Old 12-20-2003, 07:00 AM   #21
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Re: Anyone see Scott Burns column yesterday ? *

wzd,

I don't usually read entire books on finance because I feel that I understand the basic principles (as developed primarily by academics), and don't want to devote that much time to possibly picking up a few "fine points." Instead, I read short articles on the internet and in the financial news that seem (on the basis of their titles) to have something new to add.

My approach to investing is a lot like my approach to my career in civil engineering. The basic principles don't change, and as long as I can not identify how a proposed course of action would violate basic principles, it almost always works.
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Re: Anyone see Scott Burns column yesterday ? *
Old 12-20-2003, 07:40 AM   #22
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Re: Anyone see Scott Burns column yesterday ? *

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My approach to investing is a lot like my approach to my career in civil engineering. *The basic principles don't change
Ted, I view most "basic principles" of investing a lot like the basic principles of weather prediction. I wish there were an underlying physics to this stuff, but for all of the historical statistical analysis done trying to find safe investing strategies, it really comes down to understanding human behavior and the interplay of a myriad of seemingly unrelated phenomena.

The markets have made many nobel laureates look like fools, so the only basic principle I subscribe to in this area is to always question your assumptions.

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Re: Anyone see Scott Burns column yesterday ? *
Old 12-20-2003, 08:27 AM   #23
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Re: Anyone see Scott Burns column yesterday ? *

[quote]

it really comes down to understanding human behavior and the interplay of a myriad of seemingly unrelated phenomena.

While that approach might provide intellectual stimulation as you turn all this stuff over in your head, I think it makes "safe investing' far more complicated that it need be.
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Re: Anyone see Scott Burns column yesterday ? *
Old 12-20-2003, 09:05 AM   #24
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Re: Anyone see Scott Burns column yesterday ? *

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While that approach might provide intellectual stimulation as you turn all this stuff over in your head, I think it makes "safe investing' far more complicated that it need be.
I don't know about more complicated, but it definitely makes me more defensive. *The stock market is a big mystery to me. *I'm willing to make a *pretty big bet on conventional market wisdom, but I also feel a need to hedge my bets with stuff I better understand.

For example, I have a bigger bet on real estate than most people. *I only invest in waterfront property because of supply/demand characteristics. *I'm aware that real estate as a market can crash, but I also take long-term comfort knowing that I'm holding real assets that will continue to hold intrinsic value in the face of almost any event.

I also decided to allocate assets to buying or building a small business because I like the control and upside potential. *Obviously not an approach everybody would want to take, but it works for me on many levels.
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Re: Anyone see Scott Burns column yesterday ? *
Old 12-20-2003, 01:23 PM   #25
 
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Re: Anyone see Scott Burns column yesterday ? *

Hello Wabmester! Your approach is a bit unorthodox, but it worked for me. I too owned a bunch of waterfront property (including my current house). Also, owned (sometimes alone - sometimes with partners)
several small businesses, starting about 20 years ago.
Although I might have pulled it off anyway, it is very difficult for me to see how I could have retired
without these components.

John Galt
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Re: Anyone see Scott Burns column yesterday ? *
Old 12-20-2003, 04:45 PM   #26
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Re: Anyone see Scott Burns column yesterday ? *

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Although I might have pulled it off anyway, it is very difficult for me to see how I could have retired
without these components. *
My sentiments exactly. I'd still be working if I only had stocks and bonds as retirement assets. I absolutely hate the transaction costs and carrying costs associated with real estate, but it certainly has helped offset my stock market stupidity.

And there is no end to the potential risks and misery associated with owning a business, but if you can find something you love to do, have positive cashflow, and build equity, there's nothing that comes close.

I'm sure I'll always invest in stocks. They seem to go up long-term even without me understanding why, but I feel that I need more control and understanding when it comes to living without a salary.
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