Strong Opinions, Weakly Held

It's my lot in life to be the last to know. I find out about relationships in the ER after an engagement ring has been presented, a child has been born or a staff member has departed.

There are ambivalent aspects to my naivete - it's arguably more difficult to enter the line of fire when you never knew where the front was; at the same time you never quite know when you may end up being shot at.

This is a profoundly digressive way to approach the recent excitement of a phrase I heard on a WCI podcast with Morgan Housel, where the finance journalist with the golden pen introduced me to the phrase "Strong opinions, weakly held."

I'd never heard it before, but when I looked it up online, it turns out this has been a part of tech guru mantra for many years, attributed to a Stanford professor with a cult following in startuplandia. Once again, I'm the last to know.

Why did the phrase resonate with me? Housel used it in the context of how one's confidence that one understands how the world works rises exponentially in one's twenties, only to begin a steady decline thereafter when life conspires to rudely inform one of just how much uncertainty exists. This, in turn, leads to a softening of dogma, such that over time those strong opinions are more pliable to modification when contradictory data emerge.

Hence older folks tend to develop strong opinions, weakly held.

Youth in this instance is regarded as a form of hubris, albeit one we can all relate to.

Asking someone about a preferred approach to finance and investing seems to similarly produce confidence out of proportion to the facts. We've heard the exclamations from all sides, even those we tend to agree with.

Real estate is the only legitimate path to great wealth. Liquidate your 401k and buy an apartment!

The three fund portfolio is the Holy Trinity!

The 4% rule is an immutable law of physics!

Sew gold bullion into the hems of your getaway outfit!

Don't concentrate your risk in a single nation - plan your escape route with outside investments in case the country goes to pot!

My own approach has softened over the years.

I've learned to be grateful for the enormous role of dumb luck in my tenuous current position of security.

I've come to appreciate that all my self-education and preparation has less influence than the wholly unknowable, but certain to occur Black Swan event that will have the greatest impact on my ostensibly reasonable investing plan (COVID at this moment; any number of novel ways to manifest going forward).

I'm less quick to judge extreme or contrarian opinions on investing, and keener to understand the kernel of truth that attracts the adherents.

I'm less interested in getting rich than, as Bernstein puts it, "not dying poor."

I continue to see a role (or is it simply hubris that refuses to die?) for that self-education and planning aspect of finance. Seneca said, Luck is when preparation meets opportunity. I'll keep preparing as long as I continue to enjoy the intellectual exercise.

Finally, I find that I am less prone to absolutism than to strong opinions, weakly held. I am continually, acutely aware of how wrong I might be, and I make constant small course-corrections to hedge against the odds of being extremely wrong in a way I might never recover from.

Whether this more pliable perspective is a function of weakness or wisdom I'll leave to others' more discerning judgment.