25th February 2025
Peter Bevelin, is one of my favourite writers & has written these wonderful books titled, ‘Seeking Wisdom’ & “All I Want To Know where I die so I never go there” apart from others.
He’s spent the better part of his life collecting and distilling timeless principles about how we can improve our thinking.
Peter Bevelin begins ‘Seeking Wisdom’ with Confucius’ great wisdom: “A man who has committed a mistake and doesn’t correct it, is committing another mistake.”
Bevelin’s quest for wisdom originated partly from making mistakes himself & observing those of others but also from the philosophy of super-investor & Berkshire Hathaway Vice Chairman Charles Munger.
Munger wrote mainly about investing, but his lessons are equally applicable to all aspects of life.
To paraphrase Buffett & Munger – ‘Decision-making is not about making brilliant decisions, but avoiding terrible ones.
Mistakes & dumb decisions are a fact of life and I’m going to make more, but as long as I can avoid the big or “fatal” mistakes, I am fine.”
He went on to add, “The best foundation for above-average long-term performance is the absence of disasters. There will always be cases & years in which, when all goes right, those who take on more risk will do better than others. In the long run, however, I feel strongly, that seeking relative performance which is just a little bit above average on a consistent basis – with protection against poor absolute results in tough times – will prove more effective than ‘swinging for the fences.’
In his book, Bevelin tells the story of Napoleon’s mother, Letizia. She couldn’t understand why Napoleon should take on the British since things were going so well. So, she sold all her French holdings and exchanged them for British pounds.
Why? She reasoned, if her son won, she would have a good life in the victorious nation. But if Napoleon lost, she would not be wiped out but still be ok since she had the pounds. She hedged against the possibility of facing a zero.
Letizia’s story is the perfect example of how to arrange our affairs in life to protect against the downside.
The benefit of looking at the downside or what can go wrong is efficiency. If you first eliminate what doesn’t work or what won’t achieve what you want, you don’t have to spend a lot of time and attention on it.
So, the important mantra of life and sensible investing is – ‘If you avoid the losers, the winners will take care of themselves.’
Avoid the losers and Stay Blessed Forever.