Hubris

Thinking you know what’s coming next, whether it be a recession, depression, capitalist utopia, communist utopia (god save us), total war with large language models and the war machines they create, or a catastrophic market crash that leads us to a post-apocalyptic world worse than anything Cormac McCarthy could think of is the epitome of hubris.

No one knows what’s going to happen tomorrow or next week or next month or next year. No one. And anyone who suggests they know doesn’t deserve your time.

Fear and fear of missing out are the worst emotions to deal with. Here’s fear: “My brother-in-law is a genius. He just went to cash. Told me I should too. He nailed the timing of Covid and thinks a bad recession is coming.” And here's fear of missing out: “My best friend, an MIT grad, just bought an ETF that tracks manure prices. Apparently, there’s going to be a massive shortage, and the price is going to skyrocket. We should get in.”

Say you take your brother-in-law’s advice and go to cash, and the market collapses two days later. Your brother-in-law is now a confirmed genius. You’re going to worship him, expecting him to call the next crash and the one after that and the one after that.

Or say you take your best friend’s advice and buy the manure ETF, and it grows by 10x in six months. Well, you’re going to worship her and expect her to make that call again. Her MIT education paid off. “Hey, do you have insights like that amazing manure call from last year?”

It’s not that easy. Your brother-in-law and your best friend suffer from hubris. If they get it right once, maybe even twice, they won’t get it right again. They were lucky.

Predicting the future isn’t about intellect, education, or a track record. It’s about luck. And a lucky person with hubris is nothing more than a prophet.