Update: I DID post yesterday, but I forgot to check the box that says, “stick on top of the blog.”

I asked my friend Robbie to write a guest post for my blog. He said he’s super busy, but to take something from his site. So here is something I found when I searched for “budgeting.” Robbie takes quotes from famous people and comments on them. The quotes are in bold, Robbie’s responses follow. Check out Robbie’s blog here: https://moneymusclesmind.wordpress.com/

“The difficulty lies, not in the new ideas, but in escaping from the old ones.” ~ John Maynard Keynes – Corporate Finance teaches the same old tired theories devised long before I was born, and I am not young.

“Capitalism is the extraordinary belief that the nastiest of men, for the nastiest of reasons, will somehow work for the benefit of us all.” ~ John Maynard Keynes – The problem is the ‘nasty’ capital owners use their ill-gotten wealth to buy the politicians which keeps out the pesky competition which impedes the beneficial work of Adam Smith’s Invisible Hand.

“When the facts change, I change my mind, What do you do, sir?” ~ John Maynard Keynes – Not being able to update your beliefs using evidence-based decision making holds a lot of us back in life.  We get stubborn, and get stuck in filter bubbles that harden our confirmation bias.  This happens in companies, as well.  Plenty of companies do things inefficiently for years or decades without taking a hard look.  Zero-based budgeting is one way to fight this inertia.

“Markets can remain irrational longer than you can remain solvent.” ~ John Maynard Keynes – Be careful using borrowed money to fund investments in risky assets.  Plenty of people (and huge corporations) become forced sellers in bear markets when they should, instead, be opportunistic buyers.  Financial markets tend to go way further than most people expect in both directions, this is one reason they are so hard to predict.

“It is better to be roughly right than precisely wrong.” ~ John Maynard Keynes – Try to summarize the main ideas in any subject, especially how they connect to each other and to adjacent concepts.  Details do matter, but make sure you go wide first before drilling down deep.  Lift your head up and look around from time to time to make sure you aren’t missing the forest for the trees.

“Long run is a misleading guide to current affairs. In the long run we are all dead.” ~ John Maynard Keynes – Long run is tough because most things are measured in the short run.  For example, the POTUS runs for election or re-election every 4 years and giant public corporations release their earnings every quarter.  However, if you can somehow look ahead for 10 years or more, you can gain an enormous advantage in life.

“Practical men who believe themselves to be quite exempt from any intellectual influence, are usually the slaves of some defunct economist. Madmen in authority, who hear voices in the air, are distilling their frenzy from some academic scribbler of a few years back” ~ John Maynard Keynes – Ironically, 40% of all the US dollars in existence were printed in the last few years based on Keynes’s distant scribbles.

“The markets are moved by animal spirits, and not by reason.” ~ John Maynard Keynes – Compare the stock prices to the underlying earnings and you can see the madness of crowds at work in the spasmodic gyrations of price.

“Successful investing is anticipating the anticipations of others.” ~ John Maynard Keynes – Another reason why shorter-term investing is so hard.  Markets can, and often do, go up on bad news and down on good news because of this anticipation effect.

“Lenin is said to have declared that the best way to destroy the Capitalist System was to debauch the currency. By a continuing process of inflation, governments can confiscate, secretly and unobserved, an important part of the wealth of their citizens. By this method they not only confiscate, but they confiscate arbitrarily; and, while the process impoverishes many, it actually enriches some. The sight of this arbitrary rearrangement of riches strikes not only at security, but at confidence in the equity of the existing distribution of wealth.” ~ John Maynard Keynes – Inflation makes inequality worse because the rich own the assets which are able to keep up with inflation.  Most of the lower classes own nothing and are on relatively fixed incomes which are quietly decimated by the pernicious effects of constant increases in the prices of the necessities of life.

“When the final result is expected to be a compromise, it is often prudent to start from an extreme position.” ~ John Maynard Keynes – This is an old marketing trick.  Start with a crazy high sticker price, then make the customer feel like they are getting a deal when they pay half of that inflated amount.

“If you owe your bank a hundred pounds, you have a problem. But if you owe a million ( or a billion), it has.” ~ John Maynard Keynes – This reality kept Trump alive through several bankruptcies.

“Worldly wisdom teaches that it is better for reputation to fail conventionally than to succeed unconventionally.” ~ John Maynard Keynes – This is why (along with the basic math of diversification) most actively-managed mutual funds look a lot like high fee index funds.

“Experience shows that what happens (that matters) is always the thing against which one has not made provision in advance.” ~ John Maynard Keynes – Shanghai completely shutting down for two months is the latest relevant example of this Black Swan effect.

“It is a good thing to make mistakes so long as you’re found out quickly.” ~ John Maynard Keynes – Hopefully you can ‘find out’ most of your own mistakes and make course corrections before it is too late and you have to start over at Square 1.

“The day is not far off when the economic problem will take the back seat where it belongs, and the arena of the heart and the head will be occupied or reoccupied, by our real problems – the problems of life and of human relations, of creation and behavior and religion.” ~ John Maynard Keynes – Sadly, he was dead wrong here…money-getting is still the main game in 2022.

“An investor who proposes to ignore near-term market fluctuations needs greater resources (cash) for safety (and to greedily scoop up future bargains when others are fearful) and must not operate on so large a scale, if at all, with borrowed money.” ~ John Maynard Keynes – Ladies, liquor and leverage – the three most dangerous and costly L’s I know of.

“We will not have any more crashes in our time.” ~ John Maynard Keynes – Said by a world-famous economist almost a hundred years ago, another bit of evidence that predicting the future is damn hard.

See you tomorrow with some… news!