How Have You Been Greedy?

Non-investing personal finance issues including insurance, credit, real estate, taxes, employment and legal issues such as trusts and wills
Post Reply
Fallible
Posts: 6536
Joined: Fri Nov 27, 2009 4:44 pm
Contact:

How Have You Been Greedy?

Post by Fallible » Fri May 24, 2013 2:36 pm

There have been topics on greed, but none that I recall or could find on this question (please correct if I'm wrong):

What is your experience with your own greed, what did you learn from it, and has the experience enabled you to better control it? I'll go first.

Although it's hardly the first time I've been greedy, I first clearly recognized mine when negotiating a real estate buyout with several others. An agreement on the amount was near, but then a new appraisal came in on the property and it was many times over the one we'd been working with (highly inflated and wrong as it later turned out). It seemed to strengthen my hand so I jumped at it - and the others promptly backed out and the deal was dead. My emotional greed caused me to lose perspective, to see beyond the money.

I think the experience made me more aware of how the emotion of greed works so that I can detect my next greed attack before it plays out.

Fallible
Bogleheads® wiki | Investing Advice Inspired by Jack Bogle

User avatar
LadyGeek
Site Admin
Posts: 48615
Joined: Sat Dec 20, 2008 5:34 pm
Location: Philadelphia
Contact:

Re: How Have You Been Greedy?

Post by LadyGeek » Fri May 24, 2013 3:30 pm

This thread is now in the Personal Finance (Not Investing) forum (behavioral finance, not necessarily about investing).
Wiki To some, the glass is half full. To others, the glass is half empty. To an engineer, it's twice the size it needs to be.

Calm Man
Posts: 2917
Joined: Wed Sep 19, 2012 9:35 am

Re: How Have You Been Greedy?

Post by Calm Man » Fri May 24, 2013 3:30 pm

Fortunately (or unfortunately) I was born with a mutation that lacks greed. This has cost me a fair amount on a number of occasions, a little on a lot of occasions and a large amount on rare occasions. I am looking into getting gene therapy. But if I can't, I will die a few dollars short but nobody will call me greedy.

Levett
Posts: 4177
Joined: Fri Feb 23, 2007 2:10 pm
Location: upper Midwest

Re: How Have You Been Greedy?

Post by Levett » Fri May 24, 2013 3:31 pm

It's hard to be greedy if you are risk averse.

I'm risk averse. :)

Lev

User avatar
VictoriaF
Posts: 18602
Joined: Tue Feb 27, 2007 7:27 am
Location: Black Swan Lake

Re: How Have You Been Greedy?

Post by VictoriaF » Fri May 24, 2013 3:42 pm

I am greedy about books. Amazon.com is my downfall.

Victoria
WINNER of the 2015 Boglehead Contest. | Every joke has a bit of a joke. ... The rest is the truth. (Marat F)

Levett
Posts: 4177
Joined: Fri Feb 23, 2007 2:10 pm
Location: upper Midwest

Re: How Have You Been Greedy?

Post by Levett » Fri May 24, 2013 3:44 pm

Calm is cool! 8-)

Lev

Fallible
Posts: 6536
Joined: Fri Nov 27, 2009 4:44 pm
Contact:

Re: How Have You Been Greedy?

Post by Fallible » Fri May 24, 2013 4:37 pm

VictoriaF wrote:I am greedy about books. Amazon.com is my downfall.

Victoria
Hi Victoria,
But when it comes to books, greed is good. :sharebeer

Fallible
Bogleheads® wiki | Investing Advice Inspired by Jack Bogle

livesoft
Posts: 62776
Joined: Thu Mar 01, 2007 8:00 pm

Re: How Have You Been Greedy?

Post by livesoft » Fri May 24, 2013 5:03 pm

Just heard an old episode of Engines of Our Ingenuity about the Great Diamond Hoax of 1872. Here's the transcript:
http://app2.kuhf.org/engines_test/episo ... les-money/

Greed!

Me? Greedy? Not so much, but I am also not generous.
Wiki This signature message sponsored by sscritic: Learn to fish.

chaz
Posts: 13601
Joined: Tue Feb 27, 2007 2:44 pm

Re: How Have You Been Greedy?

Post by chaz » Fri May 24, 2013 5:12 pm

In the movie "Wall Street", Gordon Gecko said "greed is good".
Chaz | | “Money is better than poverty, if only for financial reasons." Woody Allen | | http://www.bogleheads.org/wiki/index.php/Main_Page

nodenuff2
Posts: 356
Joined: Tue Mar 06, 2012 4:08 pm

Re: How Have You Been Greedy?

Post by nodenuff2 » Fri May 24, 2013 5:20 pm

Tried my hand at commodities when I had no business being there. All things in moderation is my mantra now.
2014 No. 42 2015 No.342 2016 No. 6 2017 238 what do I know? "Good bless America land that I love..."

gkaplan
Posts: 7034
Joined: Sat Mar 03, 2007 8:34 pm
Location: Portland, Oregon

Re: How Have You Been Greedy?

Post by gkaplan » Fri May 24, 2013 5:22 pm

Books r me
Gordon

Fallible
Posts: 6536
Joined: Fri Nov 27, 2009 4:44 pm
Contact:

Re: How Have You Been Greedy?

Post by Fallible » Fri May 24, 2013 5:26 pm

chaz wrote:In the movie "Wall Street", Gordon Gecko said "greed is good".
Actually, Gecko was quoting me. :P
(You did see my post to VictoriaF, right?)
Bogleheads® wiki | Investing Advice Inspired by Jack Bogle

User avatar
englishgirl
Posts: 2473
Joined: Thu Mar 01, 2007 5:34 pm
Location: FL

Re: How Have You Been Greedy?

Post by englishgirl » Fri May 24, 2013 5:30 pm

I am greedy every time I decide that a third (or fourth) glass of wine is an excellent idea. And then I pay for it the next day. In the short term, all I'm thinking about is how much I'm enjoying the wine, even though I know that 2 glasses is my limit. I am gradually gaining control, but probably by the time that I have the urge for the third glass solidly under control, my tolerance level will have dropped to 1 glass and I'll have to go through the whole battle all over again. I don't know quite what I've learned from it. :P

In financial matters, I tend to experience greed more as regret and/or jealousy. I don't know that I've ever been brave enough to ask for more. And yet, if I find out someone else got a better deal than me, I tend to wish I had been more forceful in negotiations.
Sarah

chaz
Posts: 13601
Joined: Tue Feb 27, 2007 2:44 pm

Re: How Have You Been Greedy?

Post by chaz » Fri May 24, 2013 5:37 pm

Fallible wrote:
chaz wrote:In the movie "Wall Street", Gordon Gecko said "greed is good".
Actually, Gecko was quoting me. :P
(You did see my post to VictoriaF, right?)
Of course I saw your post. But in your greed, you are also plagiarizing from the screenplay. I guess it's OK since you started this thread. :beer
Chaz | | “Money is better than poverty, if only for financial reasons." Woody Allen | | http://www.bogleheads.org/wiki/index.php/Main_Page

User avatar
dratkinson
Posts: 4357
Joined: Thu Jul 26, 2007 6:23 pm
Location: Centennial CO

Re: How Have You Been Greedy?

Post by dratkinson » Fri May 24, 2013 5:55 pm

Funny story.

Back in the '80s, while I was traveling with the military, my realtor *WB was unloading some of his properties using the greater fool theory of real estate investing. I knew better than to buy them from him and hope for my own greater fool. But I had not fully learned my lesson and was tempted by his offer to earn 10% interest if I'd carry a small second mortgage for his buyer who could not qualify for a **bank loan. (That should have been my first clue, but I missed it.)
  • * WB = worthless brother.
    ** Eventually learned he sold his property with owner financing.
Of course I did not have the money to carry a second mortgage, so I'd needed to first borrow it from the bank. I trusted him to arrange everything and signed blank bank loan forms for him.



Long story short.

(1) I would have earned 10% interest by carrying the second mortgage, but the bank's interest rate on my loan, I later learned when the completed forms were returned, was 11%. Doh!

(2) I say "would have earned" because his buyer skipped out on the property, left town and I never saw not one payment. The property returned to him, but I had to repay my bank loan.

(3) Eventually understood the second mortgage I carried came to him as pure profit on the property sale and he used it to spend that summer in Italy with his girlfriend.

(4) He eventually sold the property without my knowledge, as a simple oversight on his part had failed to record a lien against the property for my second mortgage. And he always claimed to be too broke afterwards to do anything about my non-collerateralized third-party personal loan. Besides, he was not the borrower! But he would do me the favor of looking into tracing the borrower for me... in his spare time.



In Arkansas, the above was then an example of "Theft by Conversion" and his dear white-haired mother would have been heartbroken had I been the cause of her #1 son going to prison. So... damned if you do, damned if you don't.

The statute of limitations has long since expired.

Afterwards, for a good time, I enjoyed talking and laughing about his financial maneuvering to his friends in his presence, while we all watched for his involuntary facial tics---his known indications for when he was caught in a lie. But still, the cover charge was too high for the limited entertainment value.
d.r.a, not dr.a. | I'm a novice investor, you are forewarned.

Fallible
Posts: 6536
Joined: Fri Nov 27, 2009 4:44 pm
Contact:

Re: How Have You Been Greedy?

Post by Fallible » Fri May 24, 2013 5:57 pm

chaz wrote:
Fallible wrote:
chaz wrote:In the movie "Wall Street", Gordon Gecko said "greed is good".
Actually, Gecko was quoting me. :P
(You did see my post to VictoriaF, right?)
Of course I saw your post. But in your greed, you are also plagiarizing from the screenplay. I guess it's OK since you started this thread. :beer
Gekko's actual line in the script: "The point is, ladies and gentleman, that greed, for lack of a better word, is good. Greed is right, greed works. Greed clarifies, cuts through, and captures the essence of the evolutionary spirit. Greed, in all of its forms; greed for life, for money, for love, knowledge has marked the upward surge of mankind."

I've always wondered what that "better word" might have been since greed seems the perfect one.
Bogleheads® wiki | Investing Advice Inspired by Jack Bogle

Fallible
Posts: 6536
Joined: Fri Nov 27, 2009 4:44 pm
Contact:

Re: How Have You Been Greedy?

Post by Fallible » Fri May 24, 2013 6:55 pm

livesoft wrote:Just heard an old episode of Engines of Our Ingenuity about the Great Diamond Hoax of 1872. Here's the transcript:
http://app2.kuhf.org/engines_test/episo ... les-money/

Greed!

Me? Greedy? Not so much, but I am also not generous.
Enjoyed the article. And all it took to spot the con was the way all the diamonds, etc., were buried - only inches deep in already disturbed ground. That's what greed will do, cause you to miss the forest for the trees.
Bogleheads® wiki | Investing Advice Inspired by Jack Bogle

User avatar
VictoriaF
Posts: 18602
Joined: Tue Feb 27, 2007 7:27 am
Location: Black Swan Lake

Re: How Have You Been Greedy?

Post by VictoriaF » Sat May 25, 2013 8:37 am

Fallible wrote:
chaz wrote:
Fallible wrote:
chaz wrote:In the movie "Wall Street", Gordon Gecko said "greed is good".
Actually, Gecko was quoting me. :P
(You did see my post to VictoriaF, right?)
Of course I saw your post. But in your greed, you are also plagiarizing from the screenplay. I guess it's OK since you started this thread. :beer
Gekko's actual line in the script: "The point is, ladies and gentleman, that greed, for lack of a better word, is good. Greed is right, greed works. Greed clarifies, cuts through, and captures the essence of the evolutionary spirit. Greed, in all of its forms; greed for life, for money, for love, knowledge has marked the upward surge of mankind."

I've always wondered what that "better word" might have been since greed seems the perfect one.
Hi Fallible and Chaz,

Gordon Gekko's pronouncement notwithstanding, greed is seldom good. Greed means over-doing, going too far along a path, well beyond the point of the optimum return. Greed means suspending will power and following basic instincts of System-1. Greed means avoiding making choices and not being selective.

Psychologists have identified people's bias toward names and acronyms similar to their own. Look at these: greed is good, Gordon Gekko, GEICO's gekko -- Geez!

Victoria
WINNER of the 2015 Boglehead Contest. | Every joke has a bit of a joke. ... The rest is the truth. (Marat F)

guitarguy
Posts: 1762
Joined: Mon Dec 20, 2010 4:10 pm

Re: How Have You Been Greedy?

Post by guitarguy » Sat May 25, 2013 9:34 am

englishgirl wrote:I am greedy every time I decide that a third (or fourth) glass of wine is an excellent idea
More-so gluttony than greed! I speak from experience. The Mrs. and I could probably eat about a million Girl Scout thin mint cookies, so long as they come out of the freezer. Those things are straight up like crack for your taste buds! :mrgreen:

chaz
Posts: 13601
Joined: Tue Feb 27, 2007 2:44 pm

Re: How Have You Been Greedy?

Post by chaz » Sat May 25, 2013 9:58 am

guitarguy wrote:
englishgirl wrote:I am greedy every time I decide that a third (or fourth) glass of wine is an excellent idea
More-so gluttony than greed! I speak from experience. The Mrs. and I could probably eat about a million Girl Scout thin mint cookies, so long as they come out of the freezer. Those things are straight up like crack for your taste buds! :mrgreen:
Gluttony is good.
Chaz | | “Money is better than poverty, if only for financial reasons." Woody Allen | | http://www.bogleheads.org/wiki/index.php/Main_Page

reggiesimpson
Posts: 1610
Joined: Mon Dec 19, 2011 12:47 pm

Re: How Have You Been Greedy?

Post by reggiesimpson » Sat May 25, 2013 10:00 am

After serious soul searching for the last 2 minutes i can honestly state that i am not in any way greedy. Selfish is a yes but greedy is a no.

User avatar
VictoriaF
Posts: 18602
Joined: Tue Feb 27, 2007 7:27 am
Location: Black Swan Lake

Re: How Have You Been Greedy?

Post by VictoriaF » Sat May 25, 2013 10:08 am

Keeping up with the "G" theme, we now have gluttony--thank you, englishgirl and guitarguy. What's next? Good genes? Genius?

Genius is good {I beat chaz to it}.

Victoria
WINNER of the 2015 Boglehead Contest. | Every joke has a bit of a joke. ... The rest is the truth. (Marat F)

User avatar
Tortoise
Posts: 367
Joined: Sat Aug 08, 2009 3:24 am
Location: San Jose

Re: How Have You Been Greedy?

Post by Tortoise » Sat May 25, 2013 10:12 am

VictoriaF wrote:Gordon Gekko's pronouncement notwithstanding, greed is seldom good. Greed means over-doing, going too far along a path, well beyond the point of the optimum return. Greed means suspending will power and following basic instincts of System-1. Greed means avoiding making choices and not being selective.
My tale of greed is basically my thinking that I knew what I was doing when I invested a large portion of my portfolio in individual tech stocks and tech mutual funds in 1997-2000. I had returns of over 100% for at least two years. I watched it all collapse in on itself in 2000-2003 and ended up with less than I had in 1996.
"Always do right. This will gratify some people, and astonish the rest." --Mark Twain

chaz
Posts: 13601
Joined: Tue Feb 27, 2007 2:44 pm

Re: How Have You Been Greedy?

Post by chaz » Sat May 25, 2013 10:37 am

VictoriaF wrote:Keeping up with the "G" theme, we now have gluttony--thank you, englishgirl and guitarguy. What's next? Good genes? Genius?

Genius is good {I beat chaz to it}.

Victoria
You are too fast. But very good.
Chaz | | “Money is better than poverty, if only for financial reasons." Woody Allen | | http://www.bogleheads.org/wiki/index.php/Main_Page

User avatar
LadyGeek
Site Admin
Posts: 48615
Joined: Sat Dec 20, 2008 5:34 pm
Location: Philadelphia
Contact:

Re: How Have You Been Greedy?

Post by LadyGeek » Sat May 25, 2013 10:46 am

Guiding back to Greedy.... :wink:
Wiki To some, the glass is half full. To others, the glass is half empty. To an engineer, it's twice the size it needs to be.

allsop
Posts: 1046
Joined: Sun Jun 15, 2008 7:08 am

Re: How Have You Been Greedy?

Post by allsop » Sat May 25, 2013 11:02 am

^ Boglehead?

User avatar
steadyeddy
Posts: 723
Joined: Tue Mar 31, 2009 5:01 pm
Location: The Alps of the Midwest

Re: How Have You Been Greedy?

Post by steadyeddy » Sat May 25, 2013 12:42 pm

After starting a successful small business in high school, I began my investing career at age 18 with a $40,000 war chest. It's a well known fact that the knowledge fairy visits everyone at age 14 and our brains slowly leak information afterward, so at age 18 I knew (almost) everything--certainly more than the oldsters on Wall Street!

I ran a few calculators showing how my wealth would grow at a conservative 12% per year. It was impressive, but if I just took a little bit more risk to earn a moderate 18% per year, the calculator showed very impressive wealth accruing over a 40 year horizon! I decided 18% CAGR for 40 years was my goal. :oops:

I invested in a diversified basket of 10 stocks. By diversified, I mean that they represented several different kinds of consumer discretionary spending. One of the stocks kept going down despite very impressive earning reports. I consulted with the knowledge fairy and decided that the only way to make money in stocks is to be right when everyone else is wrong. I liquidated several other holdings and doubled down in the lagging issue. A few more quarters of fantastic earnings and a declining share price had me convinced that I was the only sane investor is the market. I sold everything else and bought that one stock with all my money.

It turns out I was right. The earnings reports really were fantastic. So fantastic that the SEC sent me a check for about $300 after the company went bankrupt to compensate me for the $40,000 I had lost in the fraud. Looking back, it is probably was the least expensive route I could have taken from hubris to humility, but I've had the opportunity to think of several better things I could have done with that money.

User avatar
tom0153
Posts: 939
Joined: Wed Apr 16, 2008 11:33 am
Location: Little Neck, NY

Re: How Have You Been Greedy?

Post by tom0153 » Sat May 25, 2013 1:34 pm

Tortoise wrote:
VictoriaF wrote:Gordon Gekko's pronouncement notwithstanding, greed is seldom good. Greed means over-doing, going too far along a path, well beyond the point of the optimum return. Greed means suspending will power and following basic instincts of System-1. Greed means avoiding making choices and not being selective.
My tale of greed is basically my thinking that I knew what I was doing when I invested a large portion of my portfolio in individual tech stocks and tech mutual funds in 1997-2000. I had returns of over 100% for at least two years. I watched it all collapse in on itself in 2000-2003 and ended up with less than I had in 1996.
Guilty as charged, although I avoided much of the concentration in this sector, I did later engage in some leverage in a "gambling" account, and got nailed by the flash crash.

I've since recognized, too, that perhaps my investment plan is a bit on the greedy side, and I am pulling back on my equity allocation.

I'm also a bit too frugal. I gotta spend more for some creature comforts. I somehow equate that with being a bit greedy.

Now, I'm not going to go running out and replacing my 1999 Hyundai or anything ....
Best, Tom

User avatar
baw703916
Posts: 6679
Joined: Sun Apr 01, 2007 1:10 pm
Location: Seattle

Re: How Have You Been Greedy?

Post by baw703916 » Sat May 25, 2013 2:13 pm

The Gordon Gekko "Greed is Good" speech in Wall Street was patterned after a real life commencement speech given by Ivan Boesky at the UC Berkeley Business School. Shortly thereafter, Boesky was convicted of insider trading.
Most of my posts assume no behavioral errors.

Post Reply