My Best Teachers Never Gave Me a Certificate
Some of the most useful things I've learned about money came from conversations with friends over coffee and beer. There was no classroom, no certificate at the end and nobody asked me to write 2,000 words explaining what I'd learned. I just happened to know people who understood things I didn't, so I listened to them.
Anton Kreil's sixth secret to financial success is to seek out alternative education, and this is probably one of his ten secrets that I connect with most. Not because I think conventional education is useless. I don't. I've been a teacher myself, so it would be slightly fucking awkward if I did. Education can give you knowledge, discipline, qualifications and the foundations for understanding the world. What it can't possibly do is teach you everything you're going to need for the next fifty years and then hand you a certificate at 21 saying you're finished.
That's like learning to swim in the bath and assuming you're now qualified for the North Atlantic.
My education about money, markets and business has continued throughout my adult life, and some of my best teachers have simply been people who know more than me.
One of my best friends is a foreign exchange dealer in the City of London. Talking to him over the years has helped me understand currencies and capital flows in a way that reading a textbook never could. He works inside the machinery. When currencies move, interest rates change, capital crosses borders or markets start behaving like somebody has released a ferret inside the fuse box, he isn't discussing it as an academic exercise. It's his world.
That distinction matters to me.
There's a difference between knowing the definition of a capital flow and understanding why billions of dollars suddenly decide they don't fancy being in a particular country anymore. There's a difference between knowing that currencies appreciate and depreciate and understanding what money is actually responding to. Markets aren't diagrams in textbooks. They're millions of people, institutions and governments making decisions with real money while trying to work out what everybody else is about to do.
Having a mate who lives inside that world is useful.
It's also wonderfully efficient because I can ask stupid questions without paying university tuition fees.
I've got another very close friend who's a wealth manager in Singapore. That's another source of education because he sees money from a different seat at the table. Wealth management isn't foreign exchange dealing, and foreign exchange dealing isn't running a business. Different people see different parts of the elephant. Spend enough time talking to people who actually know their corner of the world and eventually you stop thinking the elephant is a fucking tree.
Then there are the people I've never met who have influenced the way I think.
I've been a keen reader of Martin Armstrong and Armstrong Economics for years. I don't read anybody because I expect them to hand me a laminated sheet containing the future. That doesn't exist. If somebody could predict every market movement perfectly, they wouldn't be selling you a newsletter from a photograph of themselves leaning against a rented Bentley.
What interests me is being exposed to ways of thinking I wouldn't necessarily arrive at myself.
Armstrong's work has made me think much more about capital flows, confidence, currencies, sovereign debt, government and the way money moves between countries and asset classes. I don't have to agree with every conclusion somebody reaches for their thinking to be useful. That's another thing people seem to struggle with now. Apparently you either have to treat somebody as Moses coming down the mountain with the tablets or declare them a complete fucking idiot.
There's quite a lot of space between those two positions.
I take what I find useful.
Anton Kreil has been another absolute gift of knowledge. The reason I'm writing these articles is that so many of his ideas connect with things I've experienced myself but give them a clearer structure. Respect money without worshipping it. Understand assets and liabilities properly. Build your own infrastructure. Get out into the world and gain perspective. Understand that risk is subjective. Then seek education outside the standard conveyor belt.
There's a pattern underneath all of it.
Think for yourself.
That sounds simple until you notice how much of modern life is built around outsourcing your thinking to somebody wearing a tie.
And then there's the greatest alternative education I've ever had.
Running a business.
Fuck me.
If somebody could turn running a business into a university degree, nobody would survive the first semester.
Business has no interest in whether you've understood the lesson before it gives you the exam. It gives you the exam first, kicks you down the stairs afterwards and then leaves the textbook on your chest.
Staff teach you.
Customers teach you.
Competitors teach you.
Accountants teach you.
Lawyers teach you.
Banks teach you.
Governments teach you.
Markets teach you.
Sometimes they teach gently. Sometimes the lesson arrives through the letterbox wearing steel toe capped boots.
You learn about people. That's a subject large enough for several doctorates on its own. You learn that somebody who interviews brilliantly can turn out to be completely fucking useless and somebody quiet who doesn't sell themselves particularly well can become indispensable. You learn that motivation isn't something you can spray around an office like air freshener. You learn that different people want different things and that managing them all in exactly the same way is about as sensible as buying one pair of trousers for the entire company.
Customers provide another education. They teach you what people will pay for rather than what you think they ought to pay for. That's an important distinction. The market doesn't care that you've worked terribly hard on something nobody wants. You can polish a turd until you can see your face in it. You've still got a shiny turd.
Competitors teach you because they're trying to eat your lunch.
Some are excellent. Some are useless. Some make you better because they force you to sharpen what you're doing. Others teach you what not to do. Either way, they're providing information for free, which is generous of them.
Then you've got accountants and lawyers, two groups of people I've learned enormous amounts from while simultaneously experiencing the sensation of watching a taxi meter run during a traffic jam. You don't need to become an accountant or a lawyer, but running a business without understanding what they're telling you is like sitting in the passenger seat of your own car while somebody else operates the steering wheel.
And then there's Mr Market.
He's a magnificent teacher because he doesn't give a shit about your feelings.
Markets have taught me things about myself that no classroom ever could. It's easy to say you're comfortable with volatility when the line is going upwards. Everybody has balls in a bull market. Then something you own drops 20 percent and suddenly the little philosopher living inside your head has climbed out of the window.
Losing money is educational.
Painfully educational.
You remember those lessons.
Read that an asset can fall 30 percent and you nod your head. Watch your own money fall 30 percent and the lesson gets tattooed onto your brain with a rusty nail.
That's alternative education.
It's not always pleasant and there's rarely a graduation ceremony.
This is why I think the idea that education is something primarily consumed when you're young is ridiculous. At 48, I probably spend more time thinking about things I don't understand than things I do. Currency, capital flows, markets, geopolitics, business, technology, tax, investments, people. The list doesn't get shorter as you get older. It gets longer because you finally know enough to understand how much you don't fucking know.
That's useful.
The dangerous bloke isn't the one who knows he doesn't understand currencies. It's the one who watched three YouTube videos about the dollar on Sunday afternoon and now thinks the Federal Reserve should probably give him a ring.
I've been fortunate because I've accumulated people around me who know things.
A foreign exchange dealer in London sees currencies and capital flows from inside the market. A wealth manager in Singapore understands another part of the financial machine. Martin Armstrong gives me another perspective. Anton Kreil gives me another. Accountants and lawyers bring their own expertise. Staff, customers and competitors provide lessons whether I've requested them or not.
Then I have my own experience to filter it through.
That's the bit nobody else can provide.
Alternative education isn't replacing one authority with another. I don't want to escape one classroom and immediately sit down in somebody else's. I want competing information, different perspectives and people with actual skin in the game. Then I can think.
That's the education I value most now.
Not because it comes without qualifications, but because it never fucking finishes.
There's always another lesson coming.
And if you run a business, don't worry about finding it.
It'll find you.