Saturday, August 13, 2016

Writing about Wealth, from WYBWM


Do you want to write about money? Better have a lot of it. For credibility. Who heeds a pauper?  Plus, to cover any lawsuit that might ensue from someone who followed your advice and failed. I’ll say it here and perhaps elsewhere in this book: take all financial advice, even or especially mine, with skepticism. Do your own “due diligence.” “Past performance is no guarantee of future results.” Clear? Now we can continue.

Money! It makes “the world go around.” Most people want to make more of it and waste less. For this genre, academic credentials seem almost irrelevant.

Having made a bundle brings credibility. Buffett, Gates, Trump, and their ilk are well suited to write, but often too busy getting richer. And yet, since “past performance is no guarantee of future results,” as the SEC (Securities Exchange Commission) makes the investment community remind us all, we are to ignore (as if we could) that so-and-so got rich quick doing whatever it is he claims was key.

I can’t imagine scientists saying “past performance is no guarantee of future results,” or we’d have no science, no engineering, no equations, just hunches and guesses and a lot of bridges of doubtful reliability.

Saving is boring, but important. Putting a bit away regularly for a rainy day will enable you to buy an umbrella when you need one. If inflation kicks up, you may not be able to buy much more. My favorite book in the wealth genre is The Millionaire Next Door (Stanley, 2010), which shows how the old virtue of frugality retains its basic power: “Waste not, want not. Use it up, wear it out. Make do, or do without.”  Taleb’s (2012) Antifragile would have you put a small but significant fraction into high-risk, high-payoff investments and the rest in the safest, stodgiest investments you can find. You can double your money by playing red at roulette, once, if successful. Hold back a little for bus fare for getting home.

Investing is like saving, only riskier. So many schemes, so little time, so little disposable income to put at risk. If you have a great idea, use it to make money rather than to sell a book. Typically, once your great idea gets out, others will get into the act, and prices will be bid up or down to erase the temporary advantage. If you are a Nobel laureate in economic theory, then you might establish a firm like Long-Term Capital Management, rely on exotic equations and naïve assumptions about probability distributions, and go belly-up impressively.

Writing a book about money should be approached with caution, because although “past performance is no guarantee of future results,” you just might become rich and famous, which the tabloids demonstrate is no way to find happiness.


From my magnum opus, Write Your Book with Me, written for neophytes and published by Outskirts Press, available from OP and online booksellers like and in paperback and ebook formats.

The book is intended to inform, entertain, and get some of you to sign me up as your book writing and publishing coach, so see As Stephen King might have said, "Douglas Who?"

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