...according to Harry Browne, is the fact that "almost nothing turns out as expected." And yet, unlike in most other areas of their lives, in which they rightly view soothsayers as entertainers devoid of an inside track to the future justifying any go-for-broke departure from the straight and narrow of prudential common sense, somehow in the sphere of investing, perhaps driven by the fear of being "left behind" by the latest opportunities for speculative windfalls (and, need we add, spectacular losses?), millions of otherwise practical people are enchanted by one siren song or another: the claims of self-anointed "insiders" with "perfect" track records (i.e., a few lucky haphazard predictions from yesteryear masking the several dozen by the same advisor which turned sour), or the "scientific" systems of various gurus which start to fail the minute your money is on the line. By contrast, the desires of the great majority of us for the protection and enhancement of that part of our savings we cannot afford to lose as we prepare for retirement and beyond, can be best served by an investment strategy which emphasizes safety and simplicity - and which is diversified across four major investment media - stocks, bonds, gold and cash - so that, no matter what the uncertain future brings to the economy, our portfolios contain investments geared to respond well to each major trend - prosperity, inflation, tight money, or deflation. And with this strategy in place for those assets readers are counting on for their long-term survival, they still may, if they wish, speculate with that portion of their fortunes they know they can afford to lose. Ultimately, Browne's investment advice is a sound application of what, in that intoxicating book of personal philosophy which has helped so many in their quest for freedom and self-understanding, HOW I FOUND FREEDOM IN AN UNFREE WORLD (1973), he calls "The Uncertainty Trap: the urge to act as if your information were totally certain." And in their herd-based quest to sound "professional" and ahead of the competition, too many investment pundits and "experts" present themselves as "in the know" about not just why the market rose or fell today (I'm sure I'm not the only one who enjoys a great horselaugh whenever he hears broadcast reports to the effect that "the market rose today on rumors [or fears, or puffs of smoke] that..."), but what it will do tomorrow - and next year (as the always good-humored Browne points out, anyone with an authentic gift for financial prophecy wouldn't be wasting his time hawking newsletters and trading systems, or playing the talking-heads game on cable - he'd be helping the likes of George Soros and Rupert Murdoch invest a few spare billion, en route to owning his own country). Everything Browne writes merits the closest attention, and in this, his self-proclaimed last book on investing, he here presents a sort of summa of the common-sense wisdom he has garnered from thirty years of watching the rise and fall of markets - and he does so with his customary directness, clarity, and humility. He remains in a class by himself, and many of us will always be in his debt for the uncommon ideas he has expressed so ably. And above all for his own example - for the standard he has set.
