MY AMAZON Review Of The Psychology Of Money

 MY AMAZON Review Of The Psychology Of Money 

I love browsing books in offline book stores . When I saw this book cover I guffawed . How corny a cover - the brain ! How cheesy a title - The Psychology Of Money ! I picked it up ready to tear it to shreds in my mind . After all I had been reading books on money since my childhood & am a mutual fund & investments veteran through a long career there . I had read the extremely entertaining though functionally useless books of Peter Lynch - a con man who sold millions of books about active investing & after retiring confessed that active fund management was bogus , Economic textbooks by various authors including the legendary one by Paul Samuelson , The best book in the world to understand equity investing - A Random Walk Down Wall Street by Burton Malkiel , Excellent books by the genius - though an overrated one - Taleb & even out & out poppycock books like The Secret - which sold in its millions to uneducated people looking for a quick fix to getting rich . 

I immediately overcame my bias about this book - Thank you Kahneman for proving that plenty of biases are dangerous - after checking out a few pages & bought it ASAP 

Hats off to Morgan for 3 feats 

1 ) Handling so many concepts so well in one book 

2 ) Expressing old concepts in refreshing ways that drive those concepts in deeper & prompt action 

& 

3 ) Showing us some lesser known concepts in an exhilarating way 

Here is one example of a concept that I absorbed very well when I was 27 years old but was moved to take even more seriously today by the rivetting way in which it was written   

If Warren Buffet - who started investing at 10 - was a more regular guy , started investing at 30 with $ 25,000 & got a CAGR of 22 % ( His real return delivered on the Berkshire Hathaway stock ) his networth today would have been : 

$ 11 . 9 MILLION 

His actual networth today ? Hold your breath ! : 

$ 84 . 5 BILLION 

Conclusions : 

1 ) His networth would have been lower by 99.9 % would he have led a more typical life 

2 ) His skill is investing but his secret is time - something that even the poorest person has 

Lessons : 

1 ) Start early 2 ) Stay invested 3 ) Never take your eyes off the ball till you die 

In short after investing SHUT UP & WAIT 

This story blasted my brain cells more than several excellent excel sheets I had seen about the same theory several years ago 

There are several such amazing bits of investing strategy & philosophy in this book 

Hence I recommend this book to anyone who can read . It may turn out to be your life's best book