Updated on 01.31.11

The Simple Dollar Weekly Roundup: Midwest Blizzard Edition

Trent Hamm

The Midwest got absolutely hammered with snow the last few days. The job of moving this snow would seem almost insurmountable if it weren’t for our snowblower. Thank goodness for our Troy-Bilt.

Efficient-Market Hypothesis – Are You a Believer? The efficient market hypothesis essentially says that “markets and participants are at all times on a level playing field with respect to information. As such, no one person, trader, investor, speculator, whatever…has an edge over anyone else and thus, nobody should ever be able to “beat the market” over an extended period of time for any reason other than sheer luck.” I don’t agree with this. I think markets are inefficient quite often – that’s why there are bubbles. There are always large sources dipping their toes into markets, attempting to manipulate them for their own personal gain. My belief is that the only way the little guy can profit is by massive diversification. (@ darwin’s money)

Always Get Back Up: Lessons from Muhammad Ali “It’s hard to beat a guy when he’s got his mind made up that he’s going to win.” Words of wisdom there. (@ the art of nonconformity)

How to Lend Money to Friends (Without Ruining the Relationship) I don’t think there is a good way to do this. A friend of mine is lending money to his brother using a P2P lending site, though, which is an interesting approach to the situation. (@ get rich slowly)

The Simplest Diet for Lean Fitness I didn’t link to this because I think it’s some great diet solution. I linked to it because I think it clearly illustrates the one thing that works against any challenge in life: patience. You might get lucky and break a rock with a hammer, but if you give it enough time, I guarantee you the gentle lapping of waves on that rock will break it. Time and patience conquer all. (@ zen habits)

10 “Rules of Life” from Tolstoy. What Are Your Rules? Tolstoy’s rules are pretty straightforward:

Get up early (five o’clock)
Go to bed early (nine to ten o’clock)
Eat little and avoid sweets
Try to do everything by yourself
Have a goal for your whole life, a goal for one section of your life, a goal for a shorter period and a goal for the year; a goal for every month, a goal for every week, a goal for every day, a goal for every hour and for evry minute, and sacrifice the lesser goal to the greater
Keep away from women
Kill desire by work
Be good, but try to let no one know it
Always live less expensively than you might
Change nothing in your style of living even if you become ten times richer

Mine are similar, but more family oriented, though I find the “stay away from women” one to be somewhat amusing. I tend to think it’s more of a focus thing in that members of the opposite sex can be a distraction from a solitary goal. (@ the happiness project)

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  1. Katie says:

    Wasn’t Tolstoy’s wife intimately involved in his work, at least until their relationship deteriorated later on? I suspect that it’s really a goal of staying away from other women (which I gather he didn’t always do); a man of his station in that era would probably have been expected to have a number of mistresses, which would have been distracting indeed.

  2. We’re getting hammered with ice out in the East. And I just got off the phone with a guy from Australia running from a Class 5 cyclone! Crazy weather everywhere!!

    Thanks for the mention; love the roundup.

  3. valleycat1 says:

    The Zen Habits article – this is how I lost 15 lbs over a a 6 month period and anticipate dropping another 10 eventually. I’m still working toward developing even more healthy habits, but small changes do add up over time!

  4. CB says:

    Markets are a level-playing field for a value investor who buys solid companies and uses the inevitable swings up and down to his or her advantage. See Janet Lowe’s new book for clear explanation of value investing.

  5. Anuj Joshi says:

    Efficient-Market Hypothesis – Are You a Believer?

    There is always a major risk in forming a very strong opinion when it comes to trading and investing.

    As I am a trader and an investor both at the same time.For my short term Forex and futures analysis,I am a believer of Efficient-Market Hypothesis.One has to accepts the prices that we see while trading and not get egoistic about a trading position.But when it comes to long term investing and specially value investing.It is all about finding an irrational price behavior and taking advantage of that condition in a systematic way.

    Technical analysis i.e study of charts,trends and indicators is based on Efficient-Market Hypothesis while Value investing is based an opposite premise.Both are widely accepted strategies of trading and investing.

  6. Jamie says:

    @Katie: His wife was actually pretty miserable and they had a terrible relationship– Tolstoy wrote a book called “The Kreutzer Sonata” that was banned for a few decades because it attacked women pretty ferociously, implying that they are pretty much all the same, distracting, and bound to be the downfall of men. Eventually Sophia Tolstoy’s journals were published, giving additional insight into the life of her husband’s true personality. You’re right, he probably did have a number of affairs.

    (Hooray for Russian Literature classes!)

    Like Trent, I find Tolstoy’s attitude amusing :-)

  7. Jackie says:

    Tolstoy wrote those rules when he was 18. Presumably before he was married. (Not everyone can stick to the rules)

  8. JJ says:

    Whether one believes in the EMH or not, the fact remains that investors are better off investing as if it were true.


  9. Telephus44 says:

    on EMH – the best book I’ve read on this is The Long and the Short of It. Essentially, the author’s take is that the theory is very “illuminating” but not true. To believe it blindly is wrong, but to ignore is as totally false is wrong too.

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