We should avoid the trap of being penny wise and pound foolish.
However, once we have the financial controls to pound wise, we can further optimize and become penny wise.
“To buy when others are despondently selling and sell when others are greedily buying requires the greatest fortitude and pays the greatest reward.”
— John Templeton
Metaphorically, money is a liquid.
Cash flow, interest float, sunk cost, company flotation, frozen assets, liquidity, insolvency, etc.
This suggests that money follows certain physical laws.
Charlie Munger:
“I can’t think of a single example in my whole life where ‘keeping it simple’ worked against us.
We’ve made mistakes, but they weren’t because we kept it simple.”
Warren Buffett:
“It’s a lot like Cinderella at the ball: You know at midnight everything’s going to turn to pumpkins and mice…”
“[Debt] is the only way a smart guy can go broke…if you do one wrong thing along the way, it could wipe you out...”
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