A small number of large banks providing universal banking services allow for a regulator to impose strict regulatory requirement. Risk taking behaviours in banks results in greater occurrences of banking crisis & panics. Hmmmm, okay. Ho hum.
Competition in the banking sector & the political desire for the financial industry to grow into a regional hub creates increased risk taking behaviour in banks. Regulatory competition causing a fragmented regulatory landscape decreases effectiveness of regulatory bodies to forewarn of crisis. Mind blown.
I am on some financial subs and I think the fantasy of Financial Independence has completely consumed me. I am engaging in it on a daily basis. Saving and earning money is hard work and being obsessed with it makes it harder. There is nothing complex about FIRE that requires daily engagement. All FIRE requires is a good handle on one’s expenses and having discipline to saving money. I am so obsessed I compute scenarios with every calculator. In the process, getting sometimes confused, sometimes hopeful by all those different numbers that the calculators spit out. I didn’t know or realise how obsessed I was until I came across a beauty related subreddit.
I was shocked to read about how obsessed they are with beauty rituals and how the poster looks. Long conversations on wrinkles and intense discussions on layering serums. The type of questions asked is bordering on unhealthy obsession. The detailed and extremely micro stuff that nobody can really tell (eg, which eyebrow hair is out of place?) shocks me. While I do take a lot of care of my skin – sunscreen, lotions, etc I think I look average / plain / below average to others. That is, not memorable. I assume if I am unmemorable to myself, nobody else is really paying that close attention to me. The ladies & gents on’ here sub reddits seem to think everyone is holding a magnifying glass to their face every second.
I don’t need to obsess over the numbers. I know that I do it out of fear and insecurity. The unknown is terrifying and I am always padding the numbers “just in case”. Some people enjoy thinking about money. I am not one of them. I ◦ it largely out of anxiety & stress. Stress over work & wanting the stress to end.
A month ago I had a fall that got worse, requiring spitalisation & eventually surgery. I took a month off work. During my downtime, I gain a lot of clarity over my life choices.
Every decision stem from a conscious preference to play life on medium mode. I created busyness & difficulty in my life out of boredom. When life was on hard mode, I still felt boredom. I up my stress level. This sounds totally crazy. It is illogical. Yet I do it! And what happens next? Increase spend & eating on default. Leading to more money anxiety, more obsession about financial independence!
I logged into a free risk seminar on the 2023 systemic risk landscape. The call sounded like a 2023 news events roundup. I logged off soon after – it was not very useful or interesting.
Systemic risk group is an oddity. At the point of a systemic risk event occurring, it will always appear idiosyncratic until it is not. It is also mixed up with potential risk events that might affect the organisation that other organisations face. But that isn’t systemic. Rounding up news events and pointing out this might affect your organisation is not that useful without identifying the kind of organisation that will most likely be impacted.
It’s a daily struggle against instincts to extend your peacock feathers to their outermost limits and keep up with others doing the same.
The Psychology of Money: Timeless Lessons on Wealth, Greed, and Happiness by Morgan Housel
This quote explains for me why new fountain pen or gem enthusiast splurge on ever increasing dollars on inks, new pens and gemstones.
(Both are my interests but I no longer avidly collect them. I am a user more than a collector.)
Curiosity is first and foremost a big factor in hobby spend. For instance, a special new ink colour that we want to try it out for ourselves and talk about it, a new pen, a certain limited collection, a particular colour and cut of a stone – it all piques interest. The show and tell bit doesn’t get involved until the item is owned. The spreading of peacock feathers is not so much to brag about wealth but to show how up to speed, how in the know we are. When in a group of hobbyist, newbies are the biggest spenders, often buying a lot of both low and high value items. When the interest tapers off, there is a huge sell down/trade/give away of their collection. Mainly to limit it to those items that are used and usually without gains.
Another thing that I like is it explains risk management ideas in a layman language. It brings up the concept of uncertainty and explains the need for liquid capital to buffer against uncertainty. It explains that risk is not only something fearful but it is an opportunity as well. It highlights the use of money (ie savings) as a means of flexibility.
There are some bits I don’t agree with eg invest in a company that one is passionate about and the compounding stuff. I love Dairy Farm. I am still holding the loss making stock hoping for a turn around. The management is gromless and can’t figure out how to get the business back in shape but I really love the brand and the business. That is the only reason I am watching it lose more than 60% of it’s share price yet not selling it. The previous CEO left and they got a new guy from Walmart into the office in May this year and the stock continues to slide. The same adage about compounding didn’t always work out for me. I had an European ETF since 2008 and it continues to be loss making. A Chinese ETF made huge profits at first only to reverse and it is still loss making.
I suppose this book is like any investment. Sometimes you lose, sometimes you gain and like good portfolio allocation, this book is mostly gains.
headbirth.com 