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Lobnek Newsletter, June 2021

Distinguishing Signal From Noise

“The idea that the future is unpredictable is undermined every day by the ease with which the past is explained.”

Daniel Kahneman (1934 –), Israeli American psychologist and economist


Jerry Seinfeld, the renowned comedian, took the world by surprise in 1998 when he announced that he would be ending his popular Seinfeld show just when its viewership was at its all-time record. Even more astonishing was that he had declined a startling $100,000,000 offer to produce one last season. He later went on to remark that “even if the public wanted more, the public is not in show business, so you should do the opposite of what the public wants. There is a reason they are not in show business.” If we were to use the stock markets as an analogy, this would be akin to taking profit on the entire portfolio at the latter stages of a major bull-run, just when things couldn’t be looking any better. It does require extraordinary effort and discipline to execute, if only because it runs counter to the allmighty “herd mentality” currents that tend to direct our thoughts and actions.

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