The two parts of action

There are two parts in action.

  1. Knowing what needs to be done.
  2. Doing it.

The first part has to do with learning, and arguably nowadays we are in the perfect context to get to know what needs to be done. Information has never been more available, there is a “five-step” list to get to do almost everything one can think of, education and peer-to-peer sharing of experiences is facilitated like never before.

The second part, on the other hand, has never been so difficult. It is where 99.9% of us fail.

Investing and the stock market is the perfect example for this. There’s a beautiful lesson by Howard Marks, co-founder of Oaktree Capital, in one of the latest Motley Fool Money podcast (interview starts around 18:50). To summarise it:

Stocks return 9-10% a year on average. We know that. Yet they rarely return between 8 and 12% in any single year. The average is not the norm. Why is that? It’s because of emotional excesses. To the upsides, that then require corrections, and to the downsides. If you think about the value of a company in a 60-year time frame, that is not impacted by what happens day-to-day, week-to-week, month-to-month, year-to-year. It is pretty stable. The changes in earnings in one quarter is not really important. But people react excessively to these things.

Howard Marks

Nobody wants us to be emotionless robot, yet if we set out to do something important to us, this is a lesson that is better to keep in mind.

2 thoughts on “The two parts of action

  1. […] They know that 99.9% of the people that will consume their content will do absolutely nothing about it. Even when you read that to be rich there are three things you totally have to do, or that to get more leads you need to follow a four-step strategy (success guaranteed!), or that the future of work demands you to most definitely have these ten characteristics, getting to implement that requires an effort that the vast majority of people are simply not ready to put in. An Italian saying goes something like “there’s a whole sea between saying and doing”, and that is the case here. Just because you know something, even if it probably would benefit you, does not mean you are capable of applying that and make of it an habit. […]


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