Sunday, June 14, 2015

Permabears and Permabulls

A 'Permabear' is someone who is always negative. They don't get to lay claim to predicting the crises that come along. It would be like someone repeatedly saying heads when you flick a coin, then saying 'watch next time' when it lands on tails, and 'I told you so' when it lands on heads. Predicting is less useful than getting stuff done and done well. A Permabear will always be moaning or doing nothing, because they are waiting for things to get worse.

A 'Permabull' is someone who is always positive. They can't lay claim to predicting the ups when they come along. The key difference is the Permabull doesn't try and predict the ups and downs. They are more interested in the general direction. The engine. They get to participate in both the ups and the downs and being the positive characters they are, believe that this is a good thing. The downs let us learn lessons. The ups are, well, awesome.

I am a Permabull when it comes to two things. As an investor I believe that well chosen Equities are always the best place to keep my money. I have always been a good saver. This may be because of Marshmallows, because I am competitive, or because I thought other things were more important than money. Whatever the reason for saving the money, the next question becomes what to do with it. I like to think of my money as an employee to get away from all the noise of trying to predict things. So in thinking of where to invest, I think of where I would like my money to work. For a person, you need to think of what you love, what you are good at, and what society needs. Investing is effectively ethical slavery. All you need to think about is which companies are good at doing what society needs. You money will love that. Even if they are a fantastic company, they will have ups and downs. I try think of the engine. Can they learn from the downs, reinvent where necessary and participate in the ups. Buying a reasonable number of companies like that means I don't have to worry about pure bad luck, and can allow for my own bad decisions. Another way I allow for my own bad decisions is by finding other investors I trust to invest the money for me. The majority of my money is still managed by others as I think you need more grey hair, and for life to punch you in the stomach in a few more times.

The second thing I am a Permabull on is the World. More specifically I have always been a Permabull on South Africa. Recently I have become worried about the implications of being 'Proudly South African' and the unnecessary, arbitrary barriers that puts up with other people. But I do believe that South Africa very much shares the global long term trajectory, and that trajectory is up. That does not mean that there won't be very hard periods. Sometimes those hard periods will make you really doubt your belief. There will always be more Bears around in bad times, and more Bulls around in good times. That is because most people don't make their own minds up. Their tribes do.

One of the challenges I throw back at South African Permabears is to put their stick in the ground. Give some concrete measures and predictions. Define what you mean by 'going to the dogs'. It is not good enough to simply have a rolling 'in the next 5 years' claim that things are going to fall apart. That 'prediction' is toothless. If it were a house in Game of Thrones, the house of Permabears would have the Wet Blanket as their sigil. Things like saying 'no GDP growth' is not going to the dogs. It just means we have what we had before. Even infrastructure problems like electricity shortages, waste issues, water issues, road issues etc. are temporary if they irritate enough people into doing something about it. Or if a Pretoria born tech-genius-come-potential-bond-villain decides to suddenly solve energy problems. These are bumps, not bottomless pits. Life goes on.

This is not me being all fluffy and motivational. It is also not me saying there are not plenty of challenges. Everywhere. If there is a common thread that binds everyone from around the world, it is our ability to survive. Pick up a history book. We were all pretty much arseholes in the past. We looked down on people who weren't like us. We were sexist, racist, classist, homophobic, xenophobic blood thirsty arseholes. And we were good people. We loved the people not cut off from us by prejudice. Most of our horribleness came out of a desire to survive the best way we knew how. It just took us centuries to learn from the great moral leaders of the past just how much 'love, compassion & empathy' should override any other short-term rules of thumb we may have had to control for things we didn't understand. There is a lot we don't understand in our bubbles.

So try predict things if you want. Join a tribe if you want. I am a Global Citizen, and me and my tribe are going to get on with it.
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