by Jonathan Herson
As Charlie Munger likes to say, “To the man with a hammer every problems looks like the head of a nail.” For years I was that man with a hammer. I would be stuck with one lens for each subject, closed to any other points of view.
But after studying successful investors and Buddhism for many years my perspective began to change. I noticed that a lot of the characteristics that showed up in successful investors also showed up in Buddhist philosophy. By looking through the lens of Buddhism on stock investing, I was not only able to dramatically improve my investment results, but my life as well.
So lets get this latticework started with a brief background of Buddhism.
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Brief Background on Buddhism
In 623 BC on the border between India and Nepal a prince named Siddhartha Guatama was born. Siddhartha’s father King Shuddodana consulted Asita, a well-known sooth-sayer, concerning the future of his newborn son. Asita proclaimed that he would be one of two things: He could become a great king, even an emperor. Or he could become a great sage and savior of humanity. The king, eager that his son should become a king like himself, was determined to shield the child from anything that might result in him taking up the religious life. And so Siddhartha was kept in one or another of their three palaces, and was prevented from experiencing much of what ordinary folk might consider quite commonplace. He was not permitted to see the elderly, the sickly, the dead, or anyone who had dedicated themselves to spiritual practices. Only beauty and health surrounded Siddhartha.
As Siddhartha continued living in the luxury of his palaces, he grew increasing restless and curious about the world beyond the palace walls. He finally demanded that he be permitted to see his people and his lands. The king carefully arranged that Siddhartha should still not see the kind of suffering that he feared would lead him to a religious life, and decried that only young and healthy people should greet the prince.
As he was lead through the capital Kapilavatthu, he chanced to see a couple of old men who had accidentally wandered near the parade route. Amazed and confused, he chased after them to find out what they were. Then he came across some people who were severely ill. Finally, he came across a funeral ceremony by the side of a river, and for the first time in his life, saw death. He asked his friend and squire Chandaka the meaning of all these things, who informed him of the simple truths that Siddhartha should have known all along: That all of us get old, sick, and eventually die.
At age 29, Siddhartha came to realize that he could not be happy living as he had been. He had discovered suffering, and wanted more than anything to discover how one might overcome it.
After going from one guru to the next, and pushing his body to its absolute limits (self starvation), he decided that there had to be another way.
While sitting under the Bodhi tree and searching for the answers to human suffering, Siddhartha became the enlightened one. He had discovered the Middle Way, which is the Nirvana-bound path of moderation away from the extremes of sensual indulgence and self-mortification. He began to practice wisdom, morality and mental cultivation.
So what does all of this have to do with being a successful investor?
Lets go through the four common themes of Buddhism and how they relate to successful investing.
* Rationality
o Thinking clearly
* Empiricism
o The Buddha found his way through his own direct experience
* Pragmatism
o “Strictly speaking in Buddhism scriptural authority cannot outweigh an understanding based on reason and experience” – Dalai Lama
* Skepticism
o The Buddha told his followers not to just believe him
o They should test out his beliefs and see if they actually work
Successful Investing
* Rationality
o “Be fearful when others are greedy and greedy when others are fearful” - Warren Buffett
o Do not let your emotions get control of you-invest with reason and logic
o Peter Lynch unlearning the theories he learned at Wharton, and relearning how to invest though his own direct experience
o Most of the great investors (Buffett, Lynch, Soros) have borrowed their ideas from others, but before accepting them they tested them out. They learned how to invest mainly through their own direct experience
* Pragmatism
o “Ben's Mr. Market allegory may seem out-of-date in today's investment world, in which most professionals and academicians talk of efficient markets, dynamic hedging and betas. Their interest in such matters is understandable, since techniques shrouded in mystery clearly have value to the purveyor of investment advice. After all, what witch doctor has ever achieved fame and fortune by simply advising 'Take two aspirins?” – Warren Buffett
* Skepticism
o “Ships will sail around the world but the Flat Earth Society will flourish” – Warren Buffett
As you can see both Buddhism and successful investing have much in common.
My latticework really started to come together after I read the Kalama Sutra (a sermon given by the Buddha to his followers). After reading it, it seemed like I was reading a Berkshire Hathaway Annual Report!!! Whether he knows it or not, Mr. Buffett’s philosophy is very similar to that of a Buddhist monk (the bold wording comes from the Kalama Sutra):
o Don't believe in anything simply because you heard.
+ “You have to think for yourself. It always amazes me how high- IQ people mindlessly imitate. I never get good ideas talking to other people.” – Warren Buffett
o Do not believe in traditions because they have been handed down for many generations.
+ “After all, if you are in the shipping business, it’s helpful to have all your potential competitors be taught that the earth is flat,” comments Buffett about the current state of college financial training.
o Do not believe in anything because it is spoken and rumored by many.
+ “ A public opinion poll is no substitute for thought” – Buffett
o Do not believe in anything simply because it is found written in your religious books.
+ “If EMT were true I would be a bum on the street” – Buffett
o Do not believe in anything merely on the authority of your teachers and elders.
+ “Forecasts usually tell us more of the forecaster than of the forecast.” –Buffett
o But after observation and analysis, when you find that anything agrees with reason and is conducive to the good and benefit of one and all then accept it and live up to it.
+ “ When proper temperament joins up with the proper intellectual framework, then you get rational behavior.” – Buffett
To sum things up, don’t be afraid to combine topics which may seem unrelated. The man with a hammer syndrome is hard to overcome, but is entirely possible to conquer. In my continuing series, I am going to show you how thinking like a Buddhist monk will make you a better investor.
Works Cited: Boeree, George C. The Life of Siddhartha Gautama. 1999. Shippensbury University Website. Retrieved 4/19/2008: http://webspace.ship.edu/cgboer/siddhartha.html.
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Monday, May 5, 2008
Using the Dhamma as guideline in Investment
Who is your god??
by Florence Baingana, The Monitor (Uganda) http://www.buddhistchannel.tv/index.php?id=8,6331,0,0,1,0
So I decided to write an occasional piece that answers some of the frequently asked questions. I hope it will also stimulate a discussion; dialogue is a big thing in the Buddhism that I practice. So, I do not have a God who is external to me; the God-nature, or 'Buddhahood', is within me, and within all living beings.
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For those of us who practice it, we know we are Buddhas, but for most other people in Uganda, those who have not met Buddhism or who choose not to practice, they are inherently Buddhas.
That is, every single person has this potential within them, and so every single person must be treated with the utmost respect.
One aspect about the Buddhism of Nichiren Daishonin that can be taken as an overarching guiding principle, that can be equated to who has oversight in what we do on a minute to minute basis, is the law of cause and effect.
A synopsis of this law is that for anything that you think, say, or do, its 'cause', will have an 'effect'. So, if I think, say, or do a positive thing, it will have a positive effect and if I think, say or do something negative, then it will have a negative effect. Once one internalises this, it makes it so much easier to determine what is right and what is wrong, how I should act in this or that situation. If I do something that is likely to harm another human being, then I know for sure that it will have negative repercussions in my own life.
In whatever situation, when I may feel I have been wronged and the urge is for revenge, the important thing to remember is that the other person is responsible for the things they think, say or do and so the law will take care of things. This Law is universal, just like gravity, so it works, whether you are Buddhist or not. Let me give an example; let us say I am in a que at the bank and someone cuts in. My first reaction is to push in ahead of them, begin a physical struggle/fight, but after 14 years of practice, and on a good day, I will quietly chant/pray for their happiness. If they are happier, they do not push in, do not cause others pain, so other people will eventually not have to deal with this behaviour.
However, for today, they will inevitably have to deal with the negative cause they will have created, that will inevitably have negative effects. I do not have to create a negative cause in my life by doing something hurtful to them. This is what makes me the overall controller of my life, I have the will to determine the quality of my life, whether good or bad, happy or sad, fulfilled or bitter; I am God in this sense. We say that one has to look at the causes one is making today, to know what sort of future you will have.
I will wait for questions and hope that this will grow into a discussion where we will all come to appreciate how to live lives that contribute to peace and happiness for all, through whatever spiritual path we choose to follow. Regular Buddhist meetings are held in Entebbe at 11.00am every Saturday morning, and in Kampala and Jinja most weekends.
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Friday, April 25, 2008
101 Ways of the 21st-Century Samurai
by Masimba Biriwasha (simplebiri), OhMyNews, April 24, 2008
It's not so much defeating an opponent as overcoming one's self
As Terukeni Uki, a samurai teacher at a martial arts near Tokyo's Imperial Palace, summed it up, the modern significance of the tradition is to teach the art of winning. "Here we teach the spirit of winning, but it's not so much defeating an opponent as overcoming one's self," Uki said in an interview with National Geographic.
"These days it seems everyone is looking for someone to blame rather than focusing on himself. We're told to believe that unless you graduate from the best university and are somehow elite, you're a loser. Our message is that if you try hard, you will enjoy your life," he added. Indeed, in modern times there is lot that can be learned from the ancient spirit of the samurai to cope with the demands of an increasingly harsh and fast-paced world.
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1. Know what you want.
Famous for their exploits in battle, the samurai always knew what they wanted, and they went to all the lengths to get it. The samurai knew the danger of dilly-dallying, and that's why they gave their all to a chosen goal. Like the samurai, you define and refine what exactly you want out of your life. Your purpose must be crystal clear in your mind that you turn neither to the left nor to the right in your quest.
2. Get the right tools.
Before going into battle the samurai always checked his tools, that is, the weapons that he would use to conduct the fight. In the same vein, you must fashion yourself properly in your chosen field. You must do a check on the tools that are required in the battlefield of your chosen contribution to humanity. Without the right tools, you will not be able to get what you want. That is why the samurai always took an inventory of the weapons that were required so that he would not be found wanting at the battlefront.
In addition, you must enhance your skills and competencies before you head out to the playing ground. Preparation is a key ingredient in your quest for achieving your deeply cherished goals.
3. Give it your all.
On the battlefield, the samurai sacrificed everything, including his life. Not to say you have to commit suicide as the samurai did but you must give your all to your chosen path. You have to put in the time and energy to be able to reach your goal. The way of the warrior demands that you stay fully committed and determined to undergo the arduous journey that will lead to success. You absolutely have to give all your mind, heart and soul. Like the samurai, you must refuse to allow obstacles to deter you from following your dream.
4. Stay true to the code.
Values are the lifeblood of success. They help you to determine and even predict the choices that you make especially in times of crisis. You need to define a code that will guide you like a compass on the journey. You must never, never compromise your principles.
5. Be at your best.
The samurai teaches that you cannot do battle when your spirit is half into it, otherwise you expose yourself to the wiles of the enemy. Excellence is not a given, it's a function of the decisions and choices that you make.
6. Conquer your fear.
When the samurai went to the battlefield, they threw fear to the side, and jumped into battle like a fish into water. Fear is like a virus. It slowly infects, then ravages your whole system, and stops you from going after what you want. But why did samurai throw themselves so wholeheartedly into battle? It is because they were crystal clear about the path they had chosen.
The first thing to know is that we are never born with fear. Rather, our life experiences inject fear into our spirits, little by little, until we become immobilized to take action.
But fear is also a product of having no cause in your life, not dedicating yourself wholly to that which you really want. Hesitation becomes the order of your being.
7. Get out of your way.
Habit is the greatest cancer in the world. It is very to atrophy and yet still get an impression that you are alive. You can be "dead alive," so to speak. Thinking that you are enjoying your life but in reality you are simply slipping into a cesspit. The way of the warrior is to get out of your own way. Self-sabotage reduces your chances at advancement. In everything that you do, you must strive to choose what really matters.
8. Improve your soul.
The soul is the key to all the world has to offer. There is something in life bigger than the reality of being. Being in itself is a small, non-significant speck of the whole that defines existence. In the beginless, wherein it is begotten, being makes no real choice. Something other than being is responsible for defining factors of the beginless that eventually gives birth to being. The samurai knew that sojourning in the dark valley of being yields no results. That's why he dedicated to consistently improving the state of the soul.
The philosophies of Buddhism and Zen, and to a lesser extent Confucianism and Shinto, influenced the samurai culture. Zen meditation became an important teaching due to it offering a process to calm one's mind. The Buddhist concept of reincarnation and rebirth led samurai to abandon torture and needless killing, while some samurai even gave up violence altogether and became Buddhist monks after realizing how fruitless their killings were
9. Dedicate yourself to the arts and nature.
Take a cue from the samurai, and put a spark in your imagination by dedicating yourself to the arts. The arts and nature teach us that there is an endless world outside the miniscule reality of being.
10. A sword never rules.
The best of the samurai knew that real power lies outside the sword but in the spirit -- the spirit to conquer self. Nothing can ever be achieved without conquering self. Self is perhaps humankind's greatest enemy in today's world. Everyone looks outside self to attach blame for failure in his or her life. They do not realize that they are equally played in contributing to the position that they find themselves in their life.
Conquering self is a life mission. It is something that has to be practiced all the time. The best of the samurai knew that to be able to really and truly master the sword they had to go deeper onto their spirits to master the energy of controlling the sword.
10.1. Be a servant.
The word "samurai" is derived from the archaic Japanese verb "samurai," changed to "saburau," meaning "to serve"; thus, a samurai is a servant, that is, the servant of a lord. You must absolutely change the way you think about making a contribution to whatever cause stirs your heart. Being a leader means zero if you have nothing to offer. It's not about position. The samurai were content to serve their master to achieve a cause, using their skills and competencies. The applied what they knew to the mission that they had identified.
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Friday, April 11, 2008
There are things that Money and Mastercard can't buy
first thing he sees is a couple of aspirins and a glass of water on the side table. He sits down and sees his clothing in front of him, all clean andpressed. He looks around the room and sees that it is in perfect order, spotless, clean. So is the rest of the house. He takes the aspirins and notices a note on the table. "Honey, breakfast is on the table, I left early to go grocery shopping. Love You!"
a hot breakfast and the morning newspaper. His son is also at the table, eating. He asks, "Son, what happened last night?" His son says, "Well, you came home around 3 AM, drunk and delirious. Broke some crockery, puked in the hall, and gave yourself a black eye when you stumbled into the door". Confused, the man asks, "So, why is everything in order and so clean, and breakfast is on the table waiting for me? I should expect a big quarrel with her!" His son replies, "Oh, that! Mom dragged you to the bedroom, and when she tried to take your clothes n shoes off, you said,
Broken crockery - $ 800.00
Breakfast - $ 10.00
Saying the Right Thing While Drunk – "PRICELESS "
There are truly some things that BOTH Money and Mastercard cannot buy !!!
