The Three Amigos — A True Story
Thirty years ago there were three friends who lived in Boston. They were pursuing law school and post-graduate education at some of the many fine educational institutions in that town. The three amigos were intellectuals; they enjoyed attending Harvard lectures on many topics. One of them recently confided that this was one of the best aspects about living in a university community, even better than actual classes.
We suspect that most readers of "A Dash" may not see the excitement of this lifestyle, but bear with us. We have been there and shared those experiences. More importantly, that is not the point.
The three friends included a range of expertise: a sociologist, an economist, and a political theorist. One night they agreed to attend a lecture by the renowned Professor X. After the presentation, they had their usual debriefing over — ahem — coffee.
The economics grad student raved about the lecture. He thought that the analysis was great — except for the segments dealing with economics.
The sociologist was similarly enthusiastic, but with a reservation. He felt that the lecturer "knew almost nothing" about sociology.
The political theorist — but by now we all know what he thought.
In articles of this type we normally like to allow readers to draw their own conclusions about the application to stocks and investments. This topic is a little different.
We feel the need to sharpen the point a bit. Much of the argument and information we see in daily reading is presented in a fashion that is illusory. The reader is offered something represented as a complete picture. It sounds great. It is convincing.
There are two key problems:
- Many readers lack the specific expertise required to evaluate the information.
- They do not know it.
The problem is that people do not respect the knowledge that others have gained from years of study and experience. They think that because they are intelligent, they can understand and interpret any information. Not understanding the limits to expertise is a costly mistake.
It is a sad thing. Intelligent investors, doing their homework, reading the leading Internet sites, reading the New York Times and watching CNBC, can easily reach expensive conclusions.
A little knowledge is a dangerous thing.