No, this isn’t a post about how to get rich quick — if you’ve been a reader of the rest of this blog you’ll know I’m very much interested in exploring the mental models of great investors by unpacking how they make their investing decisions for long term compounding.
In almost every single personal finance and/or investment piece of advice somewhere in it is some form of a need to think “long term”.
“”For capital to be truly [inflation] indexed, return on equity must rise, i.e., business earnings consistently must increase in proportion to the increase in the price level without any need for the business to add to capital – including working capital – employed. (Increased earnings produced by increased investment don’t count.) Only a few businesses come close to exhibiting this ability.
“The world is full of obvious things which nobody by any chance ever observes.”Sherlock Holmes in The Hound of the Baskervilles, Conan Doyle Maybe it’s signalling, maybe it’s marketing, maybe it’s self-selection, but I have long found fascinating what the greatest investors look when making investment decisions.
“In our retail business, we know that customers want low prices, and I know that’s going to be true 10 years from now.