Sigh. An email I got recently.

Vito writes:

“Love your name btw. Just ram it! lol. My investment strategy is non complicated. I invest everything I have in gold and silver. 75% silver and 25% gold. Simple and effective and no need to read any books. It’s doing very well. Nobody I know has the slightest clue what’s going on. They think gold and silver is gambling or it’s too risky. LOL. Fucking illiterates. Nobody taught them shit. They trusted their politicians and bankers. They deserve what is coming. Nobody wants to hear about gold and silver. Little do they know when the dollar collapses they’re all going to get rammed up the ass and I’m going to be skating away smelling like a rose with all my money and more. I don’t bother with equities either. They’re a rip job. Investors today are fucking stupid. They react to all the talk in the media and forget about the fundamentals of gold and silver and actually sell it. That is where I enter the scene and buy, knowing full well it’s got one way to go but up, like the national debt of all western economies. Thank God for fucking stupid people!”

My response:

“probably not the best strategy for the long term.”

Vito writes:

“Gold and silver is not the best strategy for the long term? Why, if you don’t mind my asking?”

My response:

“It severely underperforms other investments over the long term. This is why you need to read a couple books on personal finance — at a minimum. What is performing really well today likely won’t perform well over the long term. I cover this in my book or there are many, many other books/free articles online.”

[We go back and forth a few times and I encourage him to read some books to dig up the data himself…]

He responds:

“Well Ramit, you can keep your data. How can a best selling financial author give out this sort of nonsense for advice? What do you think, I’m some sort of dummy? Check out the data on the debt in the US and Europe. Do you even know how high it is? And the banks, do you have any data on how much toxic debt they’re carrying in worthless OTC derivatives? Anybody that follows you blindly into equities I can unequivocally guarantee will be in for a religious experience and a world of hurt. Long term equities will destroy you.”

“You can keep your data.” Ok, I think I will.

I rarely blame people alone for their lack of financial knowledge, as there are many groups to blame — schools, companies, and Wall Street — but this guy is actively proud of not reading even one book.

As with most people, education alone is not the answer to change his behavior, as he will never allow himself to be subjected to education.

It’s interesting: People complain about their finances for nearly their entire lives — without ever reading one good personal finance book.

Yet when you collect the data, you find predictable patterns.

In their 30s, they wish they saved more to travel in their 20s.

In their 40s, they wish they’d saved more for a down payment in their 30s.

And in their 50s, they wish they’d saved for one simple thing in their 40s: retirement.

Each of these groups could have done so in a period of a few weeks — then let their system automatically work for them.

But it’s easier to make doomsday predictions about the world, concoct macro-economic theories, and call other people “fucking stupid.”

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