The political divisiveness that has percolated since the 2016 election continues to suggest that our ability to view issues from other perspectives is challenged. And that’s a problem not just for our politics, but for our financial lives as well. The allure of a narrow, one-sided perspective is in the simplicity and focus of its message. But that doesn’t make it accurate. As financial advisors, we spend a lot of time reading and thinking about cognitive bias, in other words, how our “hunting stories” may overstate our upside at the expense of the outsider’s objective interpretation.
Richard Singer and Stephanie Connor Arkof of SB Capital Management were recently interviewed for a piece in The Hollywood Reporter’s annual Money & Politics issue.
Given the massive polarization between Republicans and Democrats, I have been thinking a lot about how our personal views on the environment, social issues, economics and therefore politics can affect our world-views and possibly derail a rational and disciplined long-term investment strategy.
As I write this, the US stock markets are kicking off 2017 by reaching for record, all-time highs. So why doesn’t it feel like everyone is exuberant?
Generally one has two choices when responding to the question, “How are you?” The conventional option is to simply respond, “Fine. How are you?” and move on with life. The other choice is to respond honestly in some long, drawn-out monologue for which nobody really has the time or interest to hear. Often honest to a fault, I sometimes take the less conventional route and bore my friends to death.
We at Singer Burke practice wealth and business management, which of course includes managing investments and developing plans to optimize the taxes, retirements and estates of our dear clients. These are all very important, tangible services with financial benefits easily quantified through performance reports and balance sheets.
Last month, CNBC ranked SB Capital Management as number 64 on its list of the Top 100 Fee-Only Wealth Management Firms in the country. Since we were the only firm in Los Angeles to make the list, we derived a #1 ranking for LA to boot.
Most of us probably don’t consider ourselves to be gamblers in our daily lives. But think about this for a moment; aren’t almost all of the actions you take “bets?” Don’t you actually place bets on yourself, your career, or your company every day? Aren’t the decisions you make all day long, like bets, simply choices with the potential for different outcomes?
Recently I read about something called the “Eat Right for Your Blood Type” diet. It’s advocates claim that certain blood types require specific foods because of their ancestral history. With all of the dietary factors that affect your health and well-being, would you base your diet on nothing more than your blood type?
“The world is not made up of molecules and atoms…rather the world is made up of stories.” – Albert Einstein