Morgan Housel on Finance “Finance is overwhelmingly taught as a math-based field, where you put data into a formula and the formula tells you what to do, and it’s assumed that you’ll just go do it.”
Morgan Housel on How Collective Trial and Error Hasn’t Improved Personal Finance “Through collective trial and error over the years we learned how to become better farmers, skilled plumbers, and advanced chemists. But has trial and error taught us to become better with our personal finances? Are we less likely to bury ourselves in debt? More likely to save for a rainy day? Prepare for retirement? Have realistic views about what money does, and doesn’t do, to our happiness? I’ve seen no compelling evidence.”
Morgan Housel on Physics VS Finance “Physics isn’t controversial. It’s guided by laws. Finance is different. It’s guided by people’s behaviors. And how I behave might make sense to me but look crazy to you.” Economies are actually based in science, but people’s understanding of them is so unscientific…
Morgan Housel on Studying the Financial Crisis “The more I studied and wrote about the financial crisis, the more I realized that you could understand it better through the lenses of psychology and history, not finance.” I absolutely agree, and did just that!
Morgan Housel on Two Topics that Impact Everyone “Two topics impact everyone, whether you are interested in them or not: health and money. The health care industry is a triumph of modern science, with rising life expectancy across the world. Scientific discoveries have replaced doctors’ old ideas about how the human body works, and virtually everyone is healthier because of it. The money industry – investing, personal finance, business planning – is another story.”
“In what other industry does someone with no college degree, no training, no background, no formal experience, and no connections massively outperform someone with the best education, the best training, and the best connections?”
Another one: “One, financial outcomes are driven by luck, independent of intelligence and effort. That’s true to some extent, and this book will discuss it in further detail. Or, two (and I think more common), that financial success is not a hard science. It’s a soft skill, where how you behave is more important than what you know… I call this soft skill the psychology of money.”
“A genius who loses control of their emotions can be a financial disaster. The opposite is also true. Ordinary folks with financial education can be wealthy if they have a handful of behavioral skills that have nothing to do with formal measures of intelligence.”
