Ryan Caplet’s Reviews > The Psychology of Money: Timeless Lessons on Wealth, Greed, and Happiness > Status Update

The end of the book he gives a nice overview of modern history after world war two from a financial perspective.

People often believe stories people tell over the numbers of reality. They even go to a point where they are have convinced themselves something the opposite of what might be actually going on and often people have an incomplete view of what’s going on and a lack of understanding of what’s always happening.

Other good stories of pessimism is like when the Wright brothers went to invent an airplane many people thought they couldn’t ever get anyone why but now look at us. Same goes for the computer that Stephen Hawking uses to talk. People are quick to listen to the negative voices that things are impossible.

When it comes to money people like pessimism, they don’t like optimism. Often optimism gets ignored, and people pay attention to pessimistic attitudes. A good example was what actually happened in Japan after the war, but no one said it was gonna be like that.

Next chapter is talking about how nothing is free and you can’t just steal stuff because it ends up with worse consequences in the long run. It’s best to commit to something and watch it compound overtime but there’s always a price to pay.

Recently read the chapter about you changing overtime. Sometimes who you are when you are in college it’s completely different than who you are 15 years later. You may need to adjust your financial planning multiple times, depending on your needs at each age.

The best way to navigate a world of odds is to have a margin of safety or room for error. Sometimes spending on major purchases the spending is more or decline happens. If you make room for error it allows you to endure all sorts of outcomes and once in a while you get big gains but it happens infrequently.

Also, you can’t predict things will happen, but you can have a understanding of how things might go based on calculations of risk and error chance.

Since then, I’ve been learning about surprises and starting on having an understanding of error when your plans go wrong. The big thing was surprises is you can’t predict them but you can kind of see what might cause a surprise change. When certain people people come along are certain things get invented it can change how people think about things.

Just like with money people like reasonable stuff like how it benefits, their family or their health or how they sleep at night.