What a Video Game Taught Me About Investing

It’s amazing how much can be learned from reflecting on seemingly innocuous and unrelated experiences.1 Nostalgia undoubtedly paints the past in rosier hues, but I’m often left smiling at memories’ unintended lessons. Recently, I chanced upon the following sentence in William Bernstein’s The Investor’s Manifesto:

I emphasize three main principles: first, to not be too greedy; second, to diversify as widely as possible; and third, to always be wary of the investment industry.

As my eyes scanned the passage, the words to not be too greedy brought with them a flash of memory—hours upon hours during childhood spent in the basement den playing Mighty Bomb Jack on the original Nintendo Entertainment System. It was not a particularly interesting or good game, to say the least, and I was not very good at it. It did, however, possess a most curious feature for a video game; players were sometimes “punished” for doing too well.

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Where to Begin Learning About Economics, Finance and Investing

I never took a class on economics or personal finance in high school or college.1 I believe this more a reflection on the American educational system than own leaning prejudices, but I also believe that schools should teach children how to swim and teenagers how to drive stick shift. Until my mid-twenties, my formal financial education consisting of learning how to write a check in home economics in middle school; informally, it consisted of my father instilling in me with the idea that so long as one spent less than they made they’d get along just fine in life.

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The Only Things You Can Lose When Investing

When I was five, I wandered into the ocean surf with my wallet in my bathing suit pocket. That Velcro wallet contained my life savings, two twenty-dollar bills. After tossing around in the waves with my father for some time, I slowly realized I had lost my wallet. I say “slowly realized” because as a five-year old I did not readily accept that my wallet was lost. I insisted on searching the ocean. I was going to find wallet. My father kindly played along. We searched for an eternity comprised of what was surely no more than ten minutes.

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Welcome to Education of an Investor

Hello world! I’m Scott Rosenbaum, a 35-year old, wine and spirits importer/distributor who lives in Jersey City. I am very unqualified to write about personal finance and investing, but here we are. I invite you to join me as I teach myself as much as I can fathom useful. The ideas I write about should not be misconstrued as advice, but rather food for thought for the thoughtful.

With any luck, my self-education can be of service to you as there should be something here for everyone. For those just starting to explore the world of personal finance and investing, I’ll do my best to introduce the concepts of behavioral economics (aka the science of decision-making), recommend books, and regale you with stories of purchasing life insurance and writing one’s will.1 If you’re a seasoned wealth management professional, I offer you the chance to see “how the other half lives.” How do retail investors think about asset allocation, diversification, risk and lot of it? Can I explain to my father what an inverted yield curve means for the general economy? Or better yet, his investments? Stay tuned to find out, as I don’t yet know what an inverted yield curve is.

So what can you expect from Education of An Investor?

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