‘Losing is good’ (The Financial Athlete #9)

We’ll See (a Taoist story)

An old farmer cherished his horse. One day the horse ran away. Upon hearing the news, his neighbors said with empathy, “What bad luck.”

The old farmer remained calm and said, “We’ll see.”

Remarkably, the horse returned the next morning with three, beautiful wild horses. The neighbors rejoiced. “What good luck!”

The old farmer kept calm and said, “We’ll see.”

The following day, his son rode one of the untamed horses. He fell off the horse and broke his leg. The neighbors offered sympathy and again said, “What bad luck.”

The old farmer was not convinced this was a misfortune. He replied, “We’ll see.”

A few days later, officials drafted into the military all young men of the village except his son because he had a broken leg. The neighbors congratulated the farmer for his good fortune. “What good luck!” they said.

“We’ll see”, said the farmer.

——————————————————————————————

On a perfect sunny and windless day to play tennis I sat on a bench after losing a close match. Untimely, my tennis instructor strolled by and asked to my dismay, “Did you win?” I wondered if he was really asking, “Are my tennis lessons paying off”.

I wasn’t going to lie. I looked at him in the eyes and said unapologetically, “No. I lost.”

His response stunned me. “Losing is good, too.”

“Good for what? I play to win,” I said, thinking my response was too assertive to a respected instructor.

He explained, “Losing is a much better teacher than winning. If we tune in, losing shows what we need to work on in our game. Winning makes us feel good but too much winning can make us complacent. No one improves their game with complacency. Keep playing to win, though.” Then he walked away with a tight-lipped smile.

Is losing money with investments ‘good’ for the same reason? Certainly the emotional pain of losing a substantial amount of money outlasts the pain of losing most games in sports. Marriages have been broken due to financial losses. Health often rapidly declines and aging accelerates. Some turn to drugs and alcohol to mask an intense emotional pain rooted in the conviction the losses will never be recovered. Investors feel especially bitter when they had been deceived with false promises of large returns. How then can losing big financially ever be ‘good’?

In America people often link their own self-esteem with their net worth. They feel like champions with a towering net worth and losers if their net worth sinks six feet under.

Free your mind from this brainwashing brought on by extreme materialism. Deep pockets are not needed to live a full life. And to focus too much on fattening your wallet blinds you to the surrounding beauty in life. Your life, not what’s in your portfolio, is your most precious asset.

“Things turn out the best for the people who make the best of the way things turn out.”
– John Wooden
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