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Weekend reading: Simply the best

Weekend reading logo

What caught my eye this week.

Remember when I said I was going to simplify the compiling of my Weekend Reading links?

Well this one is ridiculously long and took pretty much a day to pull together.1

Is it better for all this heft?

When I first started linking to other blogs like this back in 2008 or 2009, I’d include just a half-a-dozen or so and some well-wishes for the weekend.

Now you need to set aside some time just to read the list of potential articles to read!

I suppose it’s easier than browsing every site for all these stories for yourself. I’m equally sure some would prefer heavier curation.

But simplicity does not come easy to me.

Nearly a decade ago I advocated simplicity in investing as best for most people – yet for some reason I centered my argument around a lecture on anthropological research into child learning behaviours.

Yep, that’s the stuff that made Monevator into the household name it is today!

Simple does it

I’m pretty normal in drifting into over-elaboration. There seems to be a human tendency to make things more complicated than they need to be, whether we’re talking about smartphones, relationships, or investment portfolios.

I did however come across a really great – and simple – piece in praise of investing simplicity (via Abnormal Returns) this week.

On his Movement Capital blog, investment advisor Adam Collins writes:

It took me a while to realize that the solution to complexity isn’t managing it better – it’s avoiding it altogether.

So simple. Go read it!

From Monevator

How I trick myself into achieving financial independence – Monevator

From the archive-ator: Horizontal diversification – Monevator

News

Note: Some links are Google search results – in PC/desktop view you can click to read the piece without being a paid subscriber. Try privacy/incognito mode to avoid cookies. Consider subscribing if you read them a lot!2

UK businesses slip into deepest downturn since 2016 – Reuters

Natwest launches new digital business challenger bank Mettle [See also Bó below]ThisIsMoney

Marie Kondo is moving into selling stuff that ‘sparks joy’. [Discuss.]Fast Company

Guardian-powered ‘Who Is Rich?’ mini-special

Labour says £70,000 a year makes you rich… – Guardian

Bary Blimp of Bolton thinks he’s “not in the top 5%, not even in the top 50%” on £80,000 a year – BBC

…for the avoidance of doubt, yes, if you earn £80,000 a year you’re in the top 5%… – Guardian

…but the super-rich are on another planet… – Guardian

…or at least in London, where they are ‘rattled’, and seeking old-fashioned security – Yahoo Finance

Products and services

Funding Circle revamps its resale market in bid to improve liquidity – ThisIsMoney

NatWest’s new youth-focused, would-be Monzo-slaying digital bank Bó has launched –

Facebook and iTunes to cryptocurrencies — what happens to digital assets when you die? [Search result]FT

Explained: the state pension, and how the goals will shift in the future – Money Observer

Ratesetter will pay you £100 [and me a cash bonus] if you invest £1,000 for a year – Ratesetter

Hargreaves hit by transfer backlog in wake of Neil Woodford crisis [Search result]FT

Nationwide’s restricted-access regular savings account is the last 5% payer left standing – ThisIsMoney

Should you get a ‘petnup’? – ThisIsMoney

Comment and opinion

Compare your progress to your plan, not to other people – Humble Dollar

It’s not how much – The Motley Fool via Twitter

It’s a great time to get a mortgage, but will rates ever be able to get back to normal? – Simon Lambert

Using first-order thinking to visualize spending decisions – The Simple Dollar

Pizza delivery is for millionaires – Mr Money Mustache

Review: Playing with FIRE documentary [Which is now on general release]Much More With Less

Are banks really magic money trees? [Paywall]FT Alphaville

Naughty corner: Active antics

Did computing power kill value investing? – Institutional Investor

Jim Simons’ Medallion Fund could have charged 50% a year and still beaten the S&P 500 – Of Dollars and Data

Are US stocks overvalued? – Ed Yardeni

My worst investment ever – UK Value Investor

[Political] regime change and valuation – Musings on Markets

Negative interest rates and the perpetuity paradox [Touches maths I mentioned in comments recently]Elm Funds

Politics & Brexit

EU citizens aren’t scrounging on the NHS, contrary to government claims [Data]In Facts

It’s not just Boris Johnson’s lying. It’s the media that let him get away with it – Guardian

Election debate: Conservatives criticised for renaming Twitter profile ‘factcheckUK’  – BBC

The Labour party manifesto in full [The second longest suicide note in history?]Labour Party

Brexit talks: the brutal reckoning that awaits the UK [Search result]FT

Three lions on a beach: a sculpture for the age of Brexit – Guardian

Kindle book bargains

How to Win Friends and Influence People in the Digital Age by Dale Carnegie & Associates – £0.99 on Kindle

The Wealthy Retirement Plan by Vicki Wusche – £0.99 on Kindle

Radical Candor: How to Get What You Want by Saying What You Mean by Kim Scott – £0.99 on Kindle

RESET: How to Restart Your Life and Get F.U. Money by David Sawyer – £0.99 on Kindle

Off our beat

The eight-hour workday is a counter-productive lie – Wired

Long read: how our home delivery habit reshaped the world – Guardian

Rituals and routines – A Wealth of Common Sense

Light pollution is ‘key driver of the insect apocalypse’ – Guardian

Extinction crisis: How can we end the illegal wildlife trade? [Search result]FT

The Google tax – Seth Godin

Forgotten gods – Indeedably

Greta Thunberg, time traveller – Guardian

And finally…

“About once every generation, the markets go barking mad. If you are unprepared, you are sure to fail.”
– William Bernstein, The Four Pillars of Investing: Lessons for Building a Winning Portfolio

Like these links? Subscribe to get them every Friday!

  1. If this sounds crazy, consider that I vet everything. What’s more I read at least five posts or articles for every one that makes it here, and these days ever more of that reading is left until Thursday/Friday. []
  2. Note some articles can only be accessed through the search results if you’re using PC/desktop view (from mobile/tablet view they bring up the firewall/subscription page). To circumvent, switch your mobile browser to use the desktop view. On Chrome for Android: press the menu button followed by “Request Desktop Site”. []

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{ 117 comments… add one }
  • 101 JimJim November 25, 2019, 9:03 am

    @Matthew. Agreed. But the children of the wealthy are only valued by the parents of those children, not necessarily by society, wealth breeds wealth. Trickle down economics may have some mechanism but I would argue it is a flawed one that has only resulted in the increasing inequalities of today’s society. Rights issues are used to increase liquidity, secondary markets are more akin to buying a property and renting it, a poor analogy perhaps but I am at work and could not think of a better one off cuff. Money eventually takes on a life of it’s own and precludes any need to produce to tackle the demands from society. In FIRE we look to get to a point where, for some, we no longer feel the need to produce as we do not need the reward. For others it gives a chance to give back by voluntary work, which, could be counterproductive in driving down some of the lower salaries. Two edges to every sword?

  • 102 The Weasel November 25, 2019, 9:15 am

    I do have sympathy for Barry from Bolton, even if he’s completely off on where he stands when measured on an individual basis.

    I don’t know Barry’s circumstances but if he’s the only breadwinner in his household then he’s paying £6536 more tax per year compared to a couple where each earn £40k (as per the 2019/2020 tax year).

    Now, I don’t want the government to tax the couple more, (they are clearly missing a trick there, though). I’d prefer them not to tax Barry so steeply. Looking at income per household is done in other countries so shouldn’t be impossible here.

    And don’t get me started on IR35. The government (a right-wing government FFS!) takes the view that a legal entity looks more like a natural person for tax purposes, because hey, the market cannot be *that* free!

  • 103 Matthew November 25, 2019, 9:29 am

    @jimjim – the secondary markets give confidence to rights issues, like the secondary car market gives confidence to buyers of new cars that wgat they’re buying has value. The secondary market helps establish the price in a rights issue 🙂

    I think errors of judgement do get made with inheritances, due to proximity bias we value those around us more, but morally you could say that an inheritee is more likely to put money to riskier, productive use in the markets, and that once money is invested it is available to companies to access through rights issues, so if they’re not drawing on that perhaps the rich aren’t spending

    Fwiw if the rich aren’t spending and are overinvested in unproductive bonds, inflation steadily redistributes that.
    Also whoever does sell the asset then goes on to spend/invest I presume

    I think we tend to over focus on the extremes of the tiniest minorities

  • 104 The Borderer November 25, 2019, 11:00 am

    @Matthew (97)
    I’m afraid you seem to have missed my point.
    You say that society values the wealthy, yes, but why?
    Bankers provide a service, yes, but cast your mind back to the financial crisis when we were ready to hang them from lamp posts.
    Footballers do indeed provide entertainment to millions, but Cristiano Ronaldo earned more in one month than George Best earned in his entire career. Did he entertain millions so much more?
    And so on.
    People are being constantly, often subtlety, bombarded by the media with the message that you have no worth unless you have this car, or that smartphone, or the other whatever. “Because your worth it”. And you can have it all in time for Christmas with no deposit.
    My point is, that the result is what we value has become totally out of whack with what is of value, and this creates the huge levels of dissatisfaction we are seeing across the Western World.
    It is identifying this that singles out the FIRE community, but we are the outliers.

  • 105 Vanguardfan November 25, 2019, 11:30 am

    @matthew I’m guessing you’re not a parent? Due to ‘proximity bias’, they make ‘errors of judgement’ in favour of their offspring all the time 😉

    Life is not an economic textbook, thankfully.

  • 106 Matthew November 25, 2019, 11:51 am

    @borderer – indeed fire people have learned to go from sheep to wolf, I agree its morally wrong to create insecurity to create artificial demand, although I think on the whole the supply of everything is increasing more and it’s difficult to seperate out this immoral behaviour – infact in doing so one might pay more in fees, depriving good companies of investment. At least you could say that dividends from immoral causes do get reinvested into good things, and on the whole the economy does good things, making us all happier than we’d be as cavemen

    Modern footballers get more money relative to inflation than George Best etc because they are providing more service – to advertisers, and the people they are entertaining are generally richer than back then (of course not all though!) – hence the money to be made from advertising

    One point I forgot @Jim – voluteering is a good thing, but if it’s not valued enough to be paid perhaos it does not do as much good for society as the desk job?

    @vanguardfan – indeed I am and I am prepared to make less moral choices for his benefit, as he is to me a surer bet of a good thing than most of society, and I can help ensure his money is deployed as productively as possible

    The economic language hopefully helps people doing boring 9-5 jobs feel like they are doing something good, and possibly deploy money more efficiently than to charity or other charitable things like volunteer work or paying taxes

  • 107 John November 25, 2019, 12:35 pm

    @Matthew: One point I forgot @Jim – voluteering is a good thing, but if it’s not valued enough to be paid perhaos it does not do as much good for society as the desk job?

    I think there’s some valid points in your post, but you’re equating financial value with good for society; something I think the vast majority of people would question if not entirely reject as a premise.

    Harold Shipman was paid quite generously, lawyers and marketeers denying the impact of smoking for decades after they were proven past doubt made out like bandits…

    Even at a less hyperbolic level it seems like a stretch to suggest that someone giving MMR vaccines as part of a charity effort in an impoverished country is doing less “good for society” than a paid nurse in a wealthy country without explicitly basing your argument on the premise that the wealth of the person you are helping is proportionate to the good you are doing.

  • 108 Factor November 25, 2019, 1:39 pm

    @TI “Nearly decade ago I advocated simplicity …..”

    “The five ascending levels of intellect are, smart, intelligent, brilliant, genius, simple.” – Albert Einstein

  • 109 JimJim November 25, 2019, 1:43 pm

    @Matthew “indeed I am and I am prepared to make less moral choices for his benefit, as he is to me a surer bet of a good thing than most of society”
    To play devil’s advocate, surely this is intervention on your part to help buffer the vagaries of the free market, favoring your own progeny. Why is this different from state intervention to favour the less fortunate geographically for instance 😉
    @John… “it seems like a stretch to suggest that someone giving MMR vaccines as part of a charity effort in an impoverished country is doing less “good for society” than a paid nurse in a wealthy country”
    Devils advocate again… Would it not be even better if a paid local employee on the ground in that country were used???

  • 110 Matthew November 25, 2019, 1:44 pm

    @john – good points! And I think indeed there is an ego value to morality as well as what economics can put a number on, but it’s easier to motivate ourselves to do difficult (but appreciated) jobs if we don’t think about it

    The nurse who goes to do vaccines sacrifices pay for an ego reward, like giving to charity is purchasing ego and making profitable but immoral choices is selling that ego

    Some of this is down to caveman instinct I think, we instinctively help the suffering that we do see because it’s more likely to help the survival of the tribe and yourself with it – this proximity bias too makes us much more sympathetic and charitable when we see images of suffering, rather than simply reading numbers.

    Proximity bias might skew what charitable choices we make

  • 111 Matthew November 25, 2019, 2:16 pm

    @jimjim – good point! I can’t deny there are capitalist reasons to vote in a socialist government to exploit, its difficult to calculate what will yield best – I suppose socialism short term, capitalism long term

    You could also argue that brutally the kids getting vaccinated had less forecaseted productivity, due to less infrastructure, health and education, but I think at the extremes it gets difficult to justify, because the morality behind capitalism is only a means to an end – of generically good outcomes for most – how far does the ends justify the means? – at some point I suppose it could break down, in ultra extreme cases like that

  • 112 Ken November 25, 2019, 3:47 pm

    As a relative newbie to passive investing I find the Movement Capital strategy interesting. On of the face of it the four EFT selection looks simple, but the balance and rebalancing between them seems relatively complex:

    https://movement.capital/strategy/

    I’d be interested in whether anyone has a similar process for rebalancing?

  • 113 Kel November 25, 2019, 10:24 pm

    @TI That index sounds unwieldy as is. I don’t blame you for giving up. But that’s my point, with over 300+ links on here, it’s not easy to find stuff. The completion of the book will probably be the impetus you need to make a basic beginner’s page though, in anticipation of all the new readers you will attract off the back of the book.

  • 114 The Borderer November 26, 2019, 1:58 am

    @Matthew (106)
    I’m obviously not putting my case clearly enough for you.
    My premise is that Western society has been so duped by major corporations, the media and the advertisers that we have forgotten what is valuable to a society. And because of this we are unhappy because we can never achieve what we are told is valuable and we must achieve.
    Imagine if the sewer workers, refuse collectors, grave diggers and road sweepers, all went on strike simultaneously, and nurses, doctors and care workers came out in sympathy! Life would become utterly intolerable within days, and modern civilisation would collapse within weeks.
    Now imagine if star footballers, celebrities, media influencers, movie stars, pop stars and other baubles on the Christmas tree of life did likewise? Nothing whatsoever.
    So who is the most valuable to society?
    “The value of a thing is the price that thing will bring”.
    So why is the least valuable to a society priced so highly compared to the most valuable?

  • 115 JimJim November 26, 2019, 7:45 am

    @the Borderer… I agree that from many perspectives that this situation is skewed. This has been going on in society for ever and it is to do with scarcity. Is gold useful? yes, but it is scarce so it is used less as a consumable and more as an asset (I don’t get gold so I don’t invest in it). Economics would have us look at a supply/demand graph to see the “value”. One thing in life I try not to involve myself in is the valuing of things because of scarcity. Talent is also a scarce thing, valuing it is impossible at the extremes. Advertising is as you say, built to drive demand, but the genie is out of the bottle on that one, try putting it back. I tend to only watch T.V. nowadays without adverts as they irk me, and my wants are pretty fulfilled at the basic level so I am content. The power of the workers coming out on strike frightens people with wealth as they know it would be bad for them but they rely upon the abundance of labour (and anti strike regulations) to control this.

  • 116 Matthew November 26, 2019, 9:04 am

    @borderer – The uskilled roles are worth more than the individuals doing them, because of labour supply as @jim mentioned, like I said before this causes elasticity of price and employers would be willing to pay more if, say, immigration was less working age and less unskilled (it’s not like you’re getting so many infants and elderly or standard education as our normal demographic, but non-eu is more educated due to minimum income requirements)

    A 4 day working week would also cause a worker shortage which would ironically raise the wages of what jobs it doesn’t kill off

  • 117 The Borderer November 27, 2019, 2:34 am

    @Matthew (116)
    I give up.

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