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Hard times create strong men Strong men create good times Good times create weak men Weak men create hard times <<PREVIOUS POST // NEXT POST>> Did you like this post? If so, could you "blanjah" me 1/4 cup of my morning coffee pls. You may also consider subscribing to receive the articles in your email, link in the column on the right.
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This gave a very interesting perspective about life in general. The Youtube clip shows the guy asking his wife to play a couple of games. The thing about it is that there are many things he took for granted when playing games cos he has played games for most of his life. So many things are intuitive for him. However, his wife needed to learn how to play games. These days, there are so many different buttons on a game controller or the number of actions available on a keyboard. So the wife needed to learn where all the buttons are and things that can be done. The thing about this lesson is that we take a lot of knowledge in our life for granted. There are folks who don't save money. Simply cos they didn't know they needed to. They aren't used to it. They never made their decisions taking into account things of the future. Same for retirement. It's just not talked about enough such that people are interested and start planning for it. Same for investments. Overall, everything is about learning new skills. If we have an interest and have someone to slowly teach us, especially the basics, it's easier to start on the journey. Otherwise, it's hard to learn something new on our own. It becomes very intimidating to learn something new without someone else guiding and showing the ropes and also teaching the easy mistakes not to make. Even for me, I have similar experiences. I've played games for a bulk of my life. But I struggle with some new games or certain types of games. And I lose interest in them really quickly. I probably COULD slowly learn to play them better if I continued to work on it, but I typically just can't be bothered. I can't play games like Starcraft, Warcraft, DotA... I'm bad at first person games cos I lose my way easily and I get dizzy. I played Counterstrike when I was younger. It was easy enough cos the maps are small. I could perform pretty well, except after around an hour, I got dizzy. I'm also bad at over the shoulder 3rd person games like Tomb Raider or Resident Evil. Cos I get dizzy after a short amount of playing. I like RPGs. I'm sure most of you know that. They are pretty slow paced, I have time to slowly explore. I don't need to make quick decisions. But similarly, when I see my young nephews play RPGs, (they are less than 8 years old), they don't play the RPGs with similar experience. They don't understand the experience and level growth, the need to heal and save, etc... Simply put, they need to learn these. Same as I had to learn it when I was younger. Just that I forgot that I needed to learn such things cos it was so long ago. So when we look at any kind of knowledge, it's not easy to learn new things. Even things like looking out for good deals. Not everyone does that, simply cos, it's not a habit. No one taught them how to do it. This gives me a better understanding and also tells me to be more patient with people. Cos, we are all at different levels of knowledge, and the knowledge we take for granted after years of slowly accumulating, isn't the same for everyone. And sometimes, a bit of help, coaching, encouragement, goes a long way to helping someone else learn a new skill, or new hobby, etc... It's a good time to coach/learn a new skill during this period where most of us are staying home most of the time. <<PREVIOUS POST // NEXT POST>> Did you like this post? If so, could you "blanjah" me 1/4 cup of my morning coffee pls. You may also consider subscribing to receive the articles in your email, link in the column on the right. You'll probably never know.
Let's look at this stock market crash. There are 4 potential conclusions. 1. You think that the market has bottomed. And you're right. 2. You think the market has bottomed. And you're wrong. 3. You think that the market has not bottomed. And you're right 4. You think that the market has not bottomed. And you're wrong. Ok, let's look at this one at a time. If you think the market has bottomed due to whatever reasons and analysis. You buy. If you're right... you conclude it's cos of your analysis. You think you're smart. Are you sure that it's cos of your analysis? Who can confirm it? You look at all your calculations and your charts and think. No... confirm it's cos of my smarts. It's not luck. IF you're wrong. You would think you're not smart, or maybe just unlucky... But who can confirm? No one can confirm smarts or luck. Investing or calling the bottom of a stock market isn't like 1+1 = 2. There's no defined formula that says, oh if this happens and this happens then the market has bottomed. Same as the other way. You think the market has not bottomed due to whatever analysis and beliefs. So you don't buy and wait... And you're right... maybe 2 months later the market drops again. And you think you're smart... But how do you know? Who can confirm that it's due to your analysis and not blind luck? Or maybe you're wrong and the market goes up... and you think it's cos you aren't smart enough, your calculations and analysis is wrong. Once again, how do you know? The thing is, in many parts of life, we don't know whether what we do is smart or just plain lucky. It's not a test where you can calculate and someone can mark the paper and give you a grade on it. There aren't any confirm right or wrong answers. Maybe my "analysis" of the stock market is just a coin flip. I flip a coin and call heads, it goes up and tails it goes down. And my super coin is always right. So I flip the coin and I buy the market and I'm right. And I think I'm smart cos I'm smart enough to co-relate the results of flipping a coin with my decisions on the stock market. But anyone from outside would view me as just dumb lucky. So how do you know your calculations are right? Maybe charts don't show anything? But somehow many people are looking at it, and they find conclusions in it. And some people will be right, and some people will be wrong. Those who are right, will think that they are smart. It's survivors bias. And they could do this many times, and they may be right many times. So they must be damn smart... But are they really? Who knows? They could be just super lucky and keep calling the market right. In life, many things are pretty much probabilities. With smarts, you can maybe improve your odds. But that doesn't determine the outcome. If you play mahjong, this becomes very apparent. There are some really skilled players, I call it "technical play". They play the game technically. Meaning, every game for every individual player, there is a "set/correct" things to do, or how to play. It increases their probability of winning cos it mathematically increases the winning probability. BUT they may lose. There's no "gut feeling". Just pure mathematical calculations. But in the long run, they would probably win. Unless everyone in the game is around the same standard. Then it averages out in the long run. It's easily concluded that studying is important to success in life, cos mathematically, it increases the odds. But I'm sure you know of people who weren't successful in school who ended up very well off, or someone who's smart in school who didn't do too well. Maybe joined a wrong company, maybe was too nice and lent money to someone and got cheated or invested in the wrong investment, etc... It's easy to look at billionaires and think that they must be super smart people. And they themselves would think they are super smart. How many would come out and say they were just plain lucky? How many people read about... "Top 6 habits of billionaires", or "The 10 things billionaires do to be successful"? You mean millionaires don't practice these 6 habits? If it's so easy to be a billionaire, then why aren't millionaires, billionaires as well? By the sheer fact that there are so little billionaires basically guarantees that they are by default, lucky. Billionaires are outliers. In any set of data, outliers are basically random points which are likely there due to sheer chance. I'm not saying that they aren't hardworking people. BUT, the element of how much luck they require to be at that position in life is severely understated. Right place, right time, meeting the right people, sending the right letter/email at the right time, etc. There are many smart people. There are many hardworking people. There are many lucky people. There are many smart, hardworking, lucky people. There are a few billionaires. Anyway, the point about this post is... How do you know if what you did is based on your smarts or skill or were you just plain lucky? Chances are, you don't. You don't know and there's no way to confirm it. Even if you're right to call the market bottom, and made the right investment decisions, you never know if you're just lucky or due to your own analysis. Cos maybe you've been looking at the wrong charts and wrong numbers drawing a wrong conclusion to the wrong thing, but resulting in the right decision to make an investment and somehow it ended up right. So... don't think you're too smart. Cos humans tend to think they are smarter than they really are. Cos they like to know that they are right, that they have the power to control their own fate. It's easy to overestimate ourselves. BUT it's just as easy to underestimate ourselves too. And it requires wisdom to know the difference. There's a lot of things within our control. To increase our probabilities of success, of happiness, etc. And we should try to do as much as we can to increase our probabilities, BUT also to recognize that there are some parts which won't be within our control and we have to leave that to chance. And accept that somethings are just not within our control. <<PREVIOUS POST // NEXT POST>> Did you like this post? If so, could you "blanjah" me 1/4 cup of my morning coffee pls. You may also consider subscribing to receive the articles in your email, link in the column on the right. Sometime long long ago, I wrote an article about living overseas
https://earlyretirementsg.weebly.com/blog/where-i-would-like-to-move-to Now, I've lived in France for 6-7 months, and US for 2 months, will probably be here much longer. As I'm watching the Coronavirus incident unfold, there are a lot of thoughts that go through my mind. Also, as I see the overall people, political climate, and other things, I have many things that I think about. After staying overseas for sometime, there are things that we see, that most people don't understand in SG. There are many grey areas. SG is a young country, it hasn't seen different Governments, hasn't seen many issues. We take our freedom and peace for granted. We don't understand why the western countries are so fixated on their freedoms, and individual freedoms, we don't understand why the French strike so much, or why people are so resistant to stay at home orders during the Coronavirus. The thing is, SG has only 1 Government since it started and it has been fairly reliable and trustworthy to the citizens. Many other countries have been through many Governments some corrupt, many countries have been through wars, civil or foreign. As Singaporeans, we have not seen this, we do not understand the suffering of people, cos we have not been though a bad enough Government or severe enough issues as a population. When I look at the history and struggles of other countries, such as the French revolution of the US civil war, I am better able to grasp why the people do what they do. Why they are willing to fight for their rights, even if it sounds stupid. The right to go out even though there is a pandemic. They fight for their rights, and strike when their employer treats them poorly. And all these actions, or their constitution, are all "controls" set in place to oversee the Government or higher authority. So that the people HAVE power. In SG, we take things for granted. We trust that the Government will take care of us well enough and they have done relatively well in the past generations. HOWEVER, this is not confirmed in the long run. The risk is, what if there comes a Government that doesn't do well for Singaporeans, AND since we are so used to keeping quiet, we just slowly get our rights removed bit by bit. How do we know that the Government is truthful? When they control the media and can potentially use the law to bend other forms of media to their will? So we may think many things in other countries are stupid and unreasonable. Cos in SG we never see the troubles that they have been through. For them, Coronavirus is a small issue, compared to their rights being taken away. Cos Coronavirus eventually will go away, maybe 3% of their population may die, but it will go away eventually, but a bad Government could ruin the country for generations to come. To them, things are very simple. IF the Government has the right to remove the rights of citizens, it doesn't matter whether it is during a pandemic or not. Cos IF the Government can infringe on the rights of citizens, means they can potentially do it anytime. For me, Singapore is currently still my home. The Government is good enough and reasonable enough, the citizens still trust the Government. We understand and are willing to sacrifice for the common good. My right to go out, does not overwrite other people's right to stay safe and healthy. So we are ok when the SG Government sets in place a circuit breaker AND passes a law to punish people who do not adhere to the rules. BUT I have concerns that 30 years from now, things may not be so simple. Staying in over countries also allowed me to be more aware of racism. Personally, I've not experienced any issues in France or US. But it's there. Westerners are more receptive to other races compared to 100 years ago. But as an Asian, I'm never going to be truly French, or American. There were reports of racism in France and America due to the Coronavirus. Even for Asians born in America. Just cos their ancestry was maybe from a country they haven't even visited. And it's all lumped as Asians. There's no distinction between Chinese, Koreans, Japanese, etc. They can't tell the difference. So there will be racism even if it's just 1% of the population, although I think it's more than 1%. You think SG doesn't have racism? Rubbish. If you're Chinese, you don't notice it. But we all know what happens behind closed doors and what people say about other races. Just cos you don't notice it doesn't mean it doesn't exist. In US, people call that "white privilege". The whites don't understand what is "white privilege". Cos they don't notice, they don't feel that they have received any additional privilege. The thing about white privilege is... they are treated normally. THAT is white privilege. The right to be treated normally. Whereas if you are Black or Hispanic, they tend not to be treated normally. They may have more checks by law enforcement, or other forms of racism, or micro racism. So the misunderstanding is that when people talk about "white privilege" they think they get something MORE than normal. That's wrong. White privilege is just to be treated NORMAL. Cos the other people aren't being treated as normal just cos of their skin colour. So many whites don't notice and realize the "privilege" or being treated normal. AND... This is the same in SG. If you're Chinese, you probably are treated normal. We have no idea what the other races go through. We don't know what kind of treatment they go through when they are kids. But it is what it is. I rather stay in a country where I'm the majority. Where I've sacrificed 2 years of my life for NS. Where I know I have the financial capacity to live well enough. Where I am safe when I go out on the streets. Where I am not afraid of any potential racist attack when I go to the supermarket. Suspect tried to kill Asian American family at a Texas Sam’s Club over coronavirus fears, reports say I am afraid. Does it happen often? No... but it is an issue to me. Singapore is still home to me. My main concern is really the Government. What will happen in 30 years? It's always about the Government. The only other places where I feel I would be able to blend into society/community is probably Malaysia or Taiwan. But once again... Government issues. So once again back to my post on nasi lemak set menu. I still like the set menu that Singapore provides. <<PREVIOUS POST // NEXT POST>> Did you like this post? If so, could you "blanjah" me 1/4 cup of my morning coffee pls. You may also consider subscribing to receive the articles in your email, link in the column on the right. Yes. You, you and you.
And everyone else. 99.999% of the world. Arrogant folks. (Me included) Even if you say you don't think you're better than Warren Buffet, your actions indicate otherwise. Walk into any room, and ask anyone. "Do you think you are a better investor than Warren Buffet?" Who dares to raise their hands? Probably nobody. And yet, almost everyone believes they are. Don't agree with me? Ok, simply put, did you invest all your equity allocation into Berkshire Hathaway? No? (Note, I said equity allocation, cos maybe someone might want to allocate into real estate or bonds for whatever reason, etc.) Heck, most people don't even own Berkshire shares!! Ok then you think you're better than the guru himself. Don't understand the logic behind it? Berkshire Hathaway owns a diversified portfolio. It is run by Warren Buffet. Investing 100% of your equity money in it, means you trust Warren Buffet in his investment skills. If you invest 99% in Berkshire, and 1% in something else. Means you think your stock picking is better than Warren Buffet. Think about it, most of us pick INDIVIDUAL STOCKS for our investment portfolio. *Roll eyes* Really? You think your calculations are better than the guru? If you buy your own shares, you are trusting your own stock picking skills. When you buy Berkshire, or any other fund, you are trusting the manager's skill. When you buy 50% Berkshire and 50% XYZ Unit Trust. Means you think the manager of XYZ Unit Trust is better or as good as Warren Buffet. Unless it is of a different asset class than what Berkshire invests in. Think about it. If you say you are a long term value investor, then you should be investing in Berkshire almost 100% of your equity portfolio, if not all of it. You probably AREN'T a better value investor than Warren Buffet. *Side note, there are other reasons not to invest in Berkshire. One may want a larger bond portfolio, different asset allocation, different country/sector allocation, etc. BUT this is something to keep in mind. Some people don't care about country/sector/asset allocation. Some people might just want to invest in a good stock with a good manager. And in all honesty, does country/sector/asset allocation matter? When an asset manager can make money, does one really care? If my parents bought 1 share of Berkshire on the day I was born in 1982, $830, the price now after the coronavirus downturn is $267k. That's a 300x return. Over 37 years. Who really cares about country/sector/asset allocation when we're looking returns at that level? Think about it. <<PREVIOUS POST // NEXT POST>> Did you like this post? If so, could you "blanjah" me 1/4 cup of my morning coffee pls. You may also consider subscribing to receive the articles in your email, link in the column on the right. The market is down a significant percent in just a month. And truth be told, I don't feel very much panic. I do have some fears and doubts, but generally, I'm pretty chill. Maybe cos I have zero losses at this point in time. My main concern is just when to pull the trigger. I already said, I've been waiting for this event for 6 years. So yes... I have "lost" 6 years of potential returns. And the question is, would I rather have lost potential returns for the past 6 years. OR would I rather be invested and be sitting on losses now? I wrote about Defending My Position here. I'm not sure if I wrote about this before... but... In 1998, I watched the Asian Financial Crisis. I was 16. I saw markets get smashed. And I thought, "If only I had an investment account and money, I'd put all my money in, cos it's so easy to make money. Everything is sure to recover." Fast forward to 2008, I was 26, I had an investment account and some money, the market dropped 20%, wahhh Great Singapore Sale... ALL IN!... I put all my money into the markets and the markets continued to fall. I was sitting on 40% paper losses. I don't know if there were more losses cos after 40%, I didn't dare to look at my portfolio total so I never knew if it dropped further. I just didn't look at it anymore and went on with my daily life. Few months later, I looked at my portfolio and it was positive. I told myself, NEVER AGAIN.  You see...
Here's the maths. Let's say Stock X is $100 before the crash. If you invest $1,000, you get 10 shares before the crash. If you invest when it has dropped 20%, you will be able to buy 12.50 shares. If you invest when it has dropped 50%, you will be able to buy 20 shares. 5 years later, the market has recovered and Stock X is now worth $130. For someone who bought before the crash, they earned 30%. For someone who bought when the price was 50% down, their return is 160%. Of course no one is able to perfectly predict the bottom, so you have to pick your own % where you think is reasonable to buy. The lesson that I learnt in 2008 was, I was too early. And instead of earning >116%, I only managed to get 62.5%. (This is an example) So now, the year is 2020... I'm 37+. I think I'm probably one cycle ahead of my peers. Cos I was watching the markets when I was 16 cos of my dad. That's the first time I was exposed to a market crash. So that's my theory lesson. And in 2008, it was my first practical lesson. Whereas for most of my peers, their theory lesson is 2008, and this Coronavirus crash is their first real practical session. Whereas this crash is my 2nd practical cycle so I'm a bit more chill. This made me feel really "Uncle", cos I think my mental state is closer to the 47+ year old folks. So when my friends ask me, "Eh why like that ar? How? Will it get worse?" Truthfully, I don't know and I don't care. To me, the market movements don't mean anything. I've set some price targets and I'll buy it they get hit. I don't think about WHY. Cos it's not something I can control. I only think about WHEN, cos that's something that I am in control of. Now, by all means, don't think that I'm absolutely "yaya" (arrogant) about this. I still am excited and nervous about the whole crash. I'm still fearful and doubtful about the downturn, and when it will recover. And when I will be deploying my capital. We all have the "same" information. But the execution will differ. I may end up being wrong. Or maybe my execution wasn't done well. Or I may buy the wrong things? For most of us, we know that this is short term. It will eventually recover. The question is WHEN and HOW LONG? Every time we go through one cycle, we are supposed to learn and gain more experience, so that we can handle the next cycle better. Maybe be in a better state of mind, better at timing, better at execution, better at whatever, maybe sleep better as well. It's the same for any other lesson. First you take a theory lesson, then you have your first practical lesson. Then you may do well or not so well. Then you get a second practical, then a third... And hopefully, we all get better after each lesson. But in the meantime... Relax la... Don't so ganjiong. <<PREVIOUS POST // NEXT POST>> Did you like this post? If so, could you "blanjah" me 1/4 cup of my morning coffee pls. You may also consider subscribing to receive the articles in your email, link in the column on the right. How capitalism is supposed to work.
Workers are supposed to get paid for their time. They work, save and life is stable. Investors put in money for research, take risks, etc... In good times they make big bucks. That's their compensation for the risk they take... Cos when times are bad, they go broke. Both of them are supposed to save for a rainy day. BUT... In reality... Workers get paid for their time. They work and spend. Investors put in money for research, take risks, etc... In good times they make big bucks. That's their compensation for the risk they take... Cos when times are bad, IF the business is big enough, they can threaten the Government that if they go bust, thousands of workers will be unemployed. So please save us with a bailout. Essentially rewarding poor and risky behaviour. Executives know this and they play the game accordingly. They can take excessive risk cos they know the company will be bailed out if anything goes wrong. Smaller companies are left out cos they are too small to be worthy of rescue. No one has money saved up and a large percentage of the population lives in debt. Unfortunately, this is the reality we live in. It's unfortunate that many businesses will face hard times in the coming months. If you're my friend, I'm sorry, you have to go though tough times. But as someone who analyses the markets, economies, etc... Business owners had their good times, now it's time to face the music. That's what capitalism is supposed to be about. If I make the wrong investment decision, then the loss is on me. If I make a good investment, then the earnings is also on me. There's no difference between opening a restaurant, a website, a wedding planner, etc. All these risks are for them to bear, for the money that they are expected to earn, and they will earn big bucks if they do well. That's the risk they take. Unfortunately, this isn't the reality we live in. If you're big enough, and you borrow enough money from the banks, you have the banks by their balls, cos if you go bust, the banks will lose money, so it's in the bank's interest to try to work out a deal. If you're big enough, and you hire enough people, you have the Government by their balls, cos if you go bust, many people will become unemployed, so it's in the Government's interest to try to work out a deal. Heads they win, tails everyone loses. <<PREVIOUS POST // NEXT POST>> Did you like this post? If so, could you "blanjah" me 1/4 cup of my morning coffee pls. You may also consider subscribing to receive the articles in your email, link in the column on the right. Everyone has different skills. Some people are good at sales. Others are not. Some people can trade stocks, day traders, weekly traders, etc... others cannot. Some people can time the market properly, others cannot... What is your skillset? I learnt that I am not good at sales. I also learnt that I am not good at trading. I also learnt that I am probably not cut out to run my own business. Even hedgefund managers don't always make money. Bill Ackman suddenly can talk very big now cos he managed to make some big bucks with a good bet. But he made some very bad bets with Valeant. It's the typical, loud when make money try to keep quiet when lost money. A perfect trader/investor would be able to buy at the bottom, sell at peaks and trade all the slight ups and down throughout the whole market cycle. BUT that's not possible. No one knows where the top is, the bottom is, and the middle peaks are. So you gotta know where your skillset lies. Long term? Short term? Trader? Buy only? Short positions? Safe investments? Gotta match your skillsets with your risk tolerance. Still need to be able to sleep soundly at night. If you're good at picking stocks, that's great. If you're good at saving, that's great too. If you can't pick stocks well, there's no issue buying an index. Maybe you're good at reading the cycle? So just buy the index or specific industry index following the cycle.  Do one thing, do it well. Everything also can make money. But better to learn and train in what you're good at, than to try multiple ways and fail all over. I know people who always want to start business, up markets want to long, down markets want to short, trade the dips, etc... Hey, just cos someone else found success in doing something else, doesn't mean you will be able to do it. Maybe can, maybe cannot. Know yourself well, and capitalize on it. <<PREVIOUS POST // NEXT POST>> Did you like this post? If so, could you "blanjah" me 1/4 cup of my morning coffee pls. You may also consider subscribing to receive the articles in your email, link in the column on the right. You learn to do anything, by doing it. You learn to fight, by fighting. Reading books, practicing kata/patterns... yes some theory works. But if you want to learn how to fight, you need to fight. You need to feel the fear of getting punched. To move even when you're afraid. To trust the muscle memory of what you have trained. No, just reading and practicing on a punching bag is not enough. How do you learn how to speak French? You learn how to speak French by speaking French. I tried studying, reading, understanding the grammar. But the body doesn't work that way. The brain doesn't work that way. The mouth cannot make the correct sounds without practicing. The ears cannot hear and understand without listening. The mind and mouth cannot formulate a response in a conversation without actually doing it. Our current knowledge, our fluency in whatever language is our first language, is all cultivated by doing it over and over again. We never noticed it, cos it was just part of our lives. We are good at walking, cos we walk. How did you learn to swim? By reading a book? Eventually you'll need to get in the water and learn muscle memory. How about driving? Same same. So... how do you invest? How do you invest in tough times? What is the muscle memory during this time? Do you feel the fear? How do you overcome this fear? First time feeling this fear? Self doubt? Are you the last man standing? Are you the last man still holding stocks when the market is falling? Or are you the last man standing on the pier and you've missed the boat, and the market has taken off without you? What you read in the books is one thing, what you watch people do is also one thing. But when it's time to get your hands dirty and swim with the sharks. Suddenly things don't seem the same anymore. I liked what 15HWW said... This is like watching a football match and cursing the player when he makes a poor decision. It’s not easy performing good decisions live, in the thick of the action. We are mere mortals. I myself suffer from all these thoughts, fears, self doubt. I was there in 2008, and no, it doesn't get any easier. Ok, it does get a bit easier. But not by much. Which is why I find it fun and important to write down things in this blog or in my other investment spreadsheet. The ideas I had BEFORE all these problems came about, my expected portfolio allocation, my plans and steps, when to do what, etc. There, I have my data, analysis, logic, why this, why that, cos... I need all those reminders. When my mind and mental state are in a better condition to make rational decisions. Now, maybe all those analyses are wrong. But at least they aren't clouded by the noise I am receiving these days. It's like operational SOP. When it's time to do it, adjust a bit and follow it. For me, at this point, I don't want to be thinking anymore. Cos the human mind is weak. It's easily affected and clouded by emotions, fear, doubt, etc... I wish you all the best during this opportunity. <<PREVIOUS POST // NEXT POST>> Did you like this post? 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This is the link to my first post... how it all started...
Mindset changes throughout the years How I make use of my wife AuthorMale, born in 1982. Archives
September 2020
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