WSJ's Zweig: Saving Investors From Themselves

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WSJ's Zweig: Saving Investors From Themselves

Postby Munir » Fri Jun 28, 2013 2:16 pm

In todays' WSJ, Jason Zweig has this column below which does not break new ground but is a good reminder in times like we have now:

http://blogs.wsj.com/moneybeat/2013/06/ ... hemselves/

"My role, therefore, is to bet on regression to the mean even as most investors, and financial journalists, are betting against it. I try to talk readers out of chasing whatever is hot and, instead, to think about investing in what is not hot. Instead of pandering to investors’ own worst tendencies, I try to push back. My role is also to remind them constantly that knowing what not to do is much more important than what to do. Approximately 99% of the time, the single most important thing investors should do is absolutely nothing".
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"We can’t assist or save the age [investors], but the attempt to do so is the only way we have of even coming close to realizing some dignity and meaning for our lives. The longer the odds, the greater the obligation to try to beat them. That’s why I keep at it, even though I have profound doubts that most people will ever learn how to be better investors. I never expect everyone to listen; all I ever hope for is to get someone to listen."
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Re: WSJ's Zweig: Saving Investors From Themselves

Postby ruralavalon » Fri Jun 28, 2013 2:46 pm

Here is my favorite quote from the article, very perceptive about the need for repetition of basic truths and about what people want to hear:

Jason Zweig wrote: . . . . . My job is to write the exact same thing between 50 and 100 times a year in such a way that neither my editors nor my readers will ever think I am repeating myself.

That’s because good advice rarely changes, while markets change constantly. The temptation to pander is almost irresistible. And while people need good advice, what they want is advice that sounds good.
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Re: WSJ's Zweig: Saving Investors From Themselves

Postby Mel Lindauer » Fri Jun 28, 2013 2:50 pm

My friend Jason knows what he speaks of. He studied investor behavior at length with many of the leading experts in the field, and authored what I consider to be the bible regarding investor behavior. The book title is "Your Money and Your Brain, How the New Science of Neuroeconomics Can Help Make You Rich" http://www.amazon.com/Your-Money-Brain- ... your+brain
Best Regards - Mel | | Semper Fi
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Re: WSJ's Zweig: Saving Investors From Themselves

Postby livesoft » Fri Jun 28, 2013 2:51 pm

This column is bookmark worthy for future citation and linking.
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Re: WSJ's Zweig: Saving Investors From Themselves

Postby maj » Fri Jun 28, 2013 3:06 pm

Munir, thank you much.
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Re: WSJ's Zweig: Saving Investors From Themselves

Postby Fallible » Fri Jun 28, 2013 3:19 pm

ruralavalon wrote:Here is my favorite quote from the article, very perceptive about the need for repetition of basic truths and about what people want to hear:

Jason Zweig wrote: . . . . . My job is to write the exact same thing between 50 and 100 times a year in such a way that neither my editors nor my readers will ever think I am repeating myself.

That’s because good advice rarely changes, while markets change constantly. The temptation to pander is almost irresistible. And while people need good advice, what they want is advice that sounds good.


My thoughts, too, and they reminded me in some ways of the former WSJ columnist and BH Jonathan Clements. About the last few years of his column, it seemed he was writing pretty much the same thing and then writing about writing pretty much the same thing. I had already begun noticing that he did seem to repeat himself, but using different examples, angles, etc., and for a darn good reason: he was right about how to invest wisely, so what else could he do but say it again and again? Fortunately for us small investors, it's always worth repeating.
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Re: WSJ's Zweig: Saving Investors From Themselves

Postby ofcmetz » Fri Jun 28, 2013 3:29 pm

Thanks for the link. I agree with livesoft that this is bookmark worthy. Zwieg imparts a lot of wisdom in this blog. He is right in saying that we are our own great enemy when it comes to successful investing.
Showing up at the donut shop at 5 am to get them hot out of the oil is an example of successful market timing.
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Re: WSJ's Zweig: Saving Investors From Themselves

Postby Van » Fri Jun 28, 2013 4:00 pm

Is there an annual Bogleheads Award? If not, maybe there should be, and Jason Zweig should be the first recipient.

I learned a considerable amount about investing from reading his articles over the years in Money magazine, and I was disappointed when he left that magazine to take his considerable talent elsewhere.
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Re: WSJ's Zweig: Saving Investors From Themselves

Postby bengal22 » Fri Jun 28, 2013 4:01 pm

Great article. I was moved by the story regarding the wisdom of his father.
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Re: WSJ's Zweig: Saving Investors From Themselves

Postby Fallible » Fri Jun 28, 2013 4:11 pm

bengal22 wrote:Great article. I was moved by the story regarding the wisdom of his father.


Agreed. Reminded me a bit of the great dad the Nobel physicist Richard Feynman had, always challenging him as a child to ask questions, think differently, use his imagination as well as his considerable intelligence.

Thanks again to the OP for the article.
"Common sense and a sense of humor are the same thing, moving at different speeds. A sense of humor is just common sense, dancing." -William James
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Re: WSJ's Zweig: Saving Investors From Themselves

Postby nedsaid » Fri Jun 28, 2013 8:42 pm

This was an excellent article by Jason Zweig. Yes, we are our own worst enemies.

With me, my biggest problem is the urge to tinker. Trying to improve my portfolio, add diversification, improve returns.
A fool and his money are good for business.
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Re: WSJ's Zweig: Saving Investors From Themselves

Postby pkcrafter » Fri Jun 28, 2013 9:21 pm

Fallible wrote:
My thoughts, too, and they reminded me in some ways of the former WSJ columnist and BH Jonathan Clements. About the last few years of his column, it seemed he was writing pretty much the same thing and then writing about writing pretty much the same thing.


On Clements retirement from WSJ

NPR: You wrote 1,009 columns. Were there any trends in personal finance that surprised you either when they came along or when they went away?

Clements: One of the things that I tell people is there are basically only 20 personal finance stories, which means that I've written each of those stories 50 times each and this, of course, is one of the reasons why I thought it was time to give it up.


:wink:

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When times are good, investors tend to forget about risk and focus on opportunity. When times are bad, investors tend to forget about opportunity and focus on risk.
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Re: WSJ's Zweig: Saving Investors From Themselves

Postby Fallible » Fri Jun 28, 2013 9:27 pm

pkcrafter wrote:Fallible wrote:
My thoughts, too, and they reminded me in some ways of the former WSJ columnist and BH Jonathan Clements. About the last few years of his column, it seemed he was writing pretty much the same thing and then writing about writing pretty much the same thing.


On Clements retirement from WSJ

NPR: You wrote 1,009 columns. Were there any trends in personal finance that surprised you either when they came along or when they went away?

Clements: One of the things that I tell people is there are basically only 20 personal finance stories, which means that I've written each of those stories 50 times each and this, of course, is one of the reasons why I thought it was time to give it up.


:wink:

Paul


Thanks for sending this. He didn't happen to say what those 20 stories were did he?
"Common sense and a sense of humor are the same thing, moving at different speeds. A sense of humor is just common sense, dancing." -William James
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Re: WSJ's Zweig: Saving Investors From Themselves

Postby mickeyd » Sat Jun 29, 2013 12:00 pm

Thanks for the link to the article. I really enjoyed it, Especially this~

On the other hand, you can’t be a columnist for The Wall Street Journal without a thick skin. I have been called an ignoramus, an idiot and dozens of epithets unprintable in a family newspaper;
accused of front-running or trading ahead of my own columns;
assailed as being in the pockets of short-sellers betting against regular investors; described as being a close friend of a person I’ve never met in my entire life;
decried as being biased in favor of high-frequency traders and as being biased against them;
and told, almost every week, that I lack even the most basic understanding of how the financial markets work.
The perennial refrain from critics is: You just don’t get it. Internet stocks / housing / energy prices / financial stocks / gold / silver / bonds / high-yield stocks / you-name-it can’t go down. This time is different, and here’s why.

But this time is never different.
Part-Owner of Texas | | “The CMH-the Cost Matters Hypothesis -is all that is needed to explain why indexing must and will work… Yes, it is that simple.” John C. Bogle
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Re: WSJ's Zweig: Saving Investors From Themselves

Postby CrossOverGuy » Sat Jun 29, 2013 3:06 pm

Jason Zweig and Jonathan Clements are my two of my favorite personal finance writers. I have clipped (and now scanned) quite a few of their columns over the years, because they just make a lot of sense and more importantly, seem genuinely interested in helping individual investors. Clements especially was like this little oasis in the middle of the "Wall Street Journal" dispensing advice that probably made big companies advertising in the same paper furious. Clements still writes for Citi; if you'd like to read some of his more recent writings, here's a link. I'm glad Zweig is still doing his thing for small investors at the WSJ as well.

http://blog.citigroup.com/tagsearch?tag=Jonathan%20Clements
Last edited by CrossOverGuy on Sat Jun 29, 2013 3:12 pm, edited 1 time in total.
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Jason Zweig

Postby Taylor Larimore » Sat Jun 29, 2013 3:10 pm

Munir:

In my opinion this may be the best article I have read about investing by a newspaper columnist, and what it's like to be an honest financial writer.

Twelve years ago I invited Jason to be our dinner speaker at our second Boglehead Reunion near the Vanguard campus in Pennsylvania. It was my honor to be Jason's chauffeur as we traveled between the train station, the motel, the restaurant where our banquet took place, and the Vanguard campus. The more time that Pat and I spent with Jason--the more impressed we became with this gentleman and writer. Our friendship remains strong to this day.

Jason's dinner speech is one of few speeches that I remember (I also can't forget Mr. Bogle's speeches). Jason's speech was about the capitalized value of future earnings and how it impacts the stock and fixed-income ratio of our portfolio. We were spellbound.

When Jason returned to his New York office he wrote what I consider is the best article ever written about the Bogleheads. This is the link:

HERE COME THE BOGLEHEADS

Thank you, Jason!

Taylor
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Re: Jason Zweig

Postby Munir » Sat Jun 29, 2013 3:52 pm

Taylor Larimore wrote:Munir:

In my opinion this may be the best article I have read about investing by a newspaper columnist, and what it's like to be an honest financial writer.

Twelve years ago I invited Jason to be our dinner speaker at our second Boglehead Reunion near the Vanguard campus in Pennsylvania. It was my honor to be Jason's chauffeur as we traveled between the train station, the motel, the restaurant where our banquet took place, and the Vanguard campus. The more time that Pat and I spent with Jason--the more impressed we became with this gentleman and writer. Our friendship remains strong to this day.

Jason's dinner speech is one of few speeches that I remember (I also can't forget Mr. Bogle's speeches). Jason's speech was about the capitalized value of future earnings and how it impacts the stock and fixed-income ratio of our portfolio. We were spellbound.

When Jason returned to his New York office he wrote what I consider is the best article ever written about the Bogleheads. This is the link:

HERE COME THE BOGLEHEADS

Thank you, Jason!

Taylor


Thank you, Taylor. Great article by Zweig about the Bogleheads that humanizes the group in a way that I haven't seen before.
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Fantastic Jason Zweig piece

Postby lorneabramson » Tue Jul 02, 2013 10:08 pm

FYI, in case anyone missed this on the WSJ's website -- Eloquent re-affirmation of timeless Boglehead principles:

http://blogs.wsj.com/moneybeat/2013/06/ ... ason+zweig

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Re: Fantastic Jason Zweig piece

Postby hoppy08520 » Tue Jul 02, 2013 10:46 pm

Great read, thank you. Thanks for pointing it out.
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Re: Fantastic Jason Zweig piece

Postby Sriracha » Tue Jul 02, 2013 10:50 pm

As my signature attests, I've had respect for Zweig's prowess as a financial writer for some time. To pick just a few quotes from this piece:

"good advice rarely changes, while markets change constantly"

'The advice that sounds the best in the short run is always the most dangerous in the long run.'

"My role is also to remind them constantly that knowing what not to do is much more important than what to do. Approximately 99% of the time, the single most important thing investors should do is absolutely nothing."

"The perennial refrain from critics is: You just don’t get it. Internet stocks / housing / energy prices / financial stocks / gold / silver / bonds / high-yield stocks / you-name-it can’t go down. This time is different, and here’s why. But this time is never different. History always rhymes. Human nature never changes. You should always become more skeptical of any investment that has recently soared in price, and you should always become more enthusiastic about any asset that has recently fallen in price. That’s what it means to be an investor."

There's more, of course. But we all know the story. Rarely, though, is it told repeatedly in periodicals as well as JZ tells it.

Oh, and ... especially now, don't reach for yield!
Don't reach for yield.
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Re: Fantastic Jason Zweig piece

Postby zaboomafoozarg » Tue Jul 02, 2013 10:52 pm

Just got a copy of The Intelligent Investor in the mail today (the one with Zweig commentary), looking forward to reading that.

“The investor’s chief problem – and even his worst enemy – is likely to be himself.”

^ this
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Re: WSJ's Zweig: Saving Investors From Themselves

Postby garlandwhizzer » Wed Jul 03, 2013 10:49 am

Great article. Wish more in the financial media world were like Mr. Zweig. So refreshing to hear the simple but profound truth and wisdom that so often gets lost in the noise of snake oil salesmen.

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Re: WSJ's Zweig: Saving Investors From Themselves

Postby nedsaid » Wed Jul 03, 2013 8:43 pm

The big institutional investors ought to read Jason Zweig's articles. Man those guys are often the worst at panicking. The retail investors are sometimes an island of calm compared to the behavior of the large institutions.
A fool and his money are good for business.
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Re: WSJ's Zweig: Saving Investors From Themselves

Postby LarryG » Wed Jul 03, 2013 9:11 pm

Taylor,
Thank you for providing the link to Jason Zweig's article about our meeting. It brought back very nice memories.
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