If you’ve been following me long enough, there’s a pretty good chance I’ve said something that pissed you off.
Maybe it was something I wrote here on Everybody’s Wrong. Maybe it was a tweet.
Or maybe you heard me say something on a video and thought to yourself, “What the hell is this guy talking about?”
Even some of my best friends have told me they couldn’t finish reading something I wrote because they were so annoyed by it.
I always find that fascinating. What was it about what I said that bothered you so much?
Was it because you disagreed with me? Was it because you owned a stock I was criticizing?
Or was I pointing out something you really didn’t want to hear?
There’s a big difference between being upset about what somebody says and being upset about how it makes you feel.
And I think that difference is worth spending some time thinking about.
My wife will sometimes walk into a room, see me sitting there doing absolutely nothing, and ask what I’m doing.
“I’m thinking.”
She’ll look at me like I’m kidding. Like I should be doing something productive instead.
But I am doing something productive. I’m thinking!
If your job is to make decisions, shouldn’t you spend some time thinking about those decisions?
In my case, I have to decide what stocks to buy, what to sell, when to do it, and how much money to put into each investment.
Those are some pretty important decisions. So why wouldn’t I dedicate time every day to thinking about them?
I’ll go for a long walk and just think. Sometimes I’ll sit in a chair and stare out the window.
Other times I’ll start writing something down, even if I have no idea where it’s going.
I’ve been writing almost every day for nearly 20 years.
At this point, it’s become a stream of consciousness. I’m basically sharing whatever happens to be going through my head.
And after that many years, you can’t really fake it. You can’t pretend to be somebody you’re not every single day for two decades. Eventually, the real you comes out anyway.
I’ve always found it much easier to just be myself.
Writing also helps me organize my thoughts. Sometimes, I don’t even realize what I think about something until I start writing about it.
Other times I finish writing and realize I don’t agree with what I thought when I started. That’s a good thing!
I’m not writing because I have all the answers. I’m writing because I’m trying to ask better questions.
And, sometimes, those questions make people uncomfortable.
It’s Not My Fault
People get really upset when you point out something that’s happening right in front of them, especially when it goes against something they already believe.
Take silver, for example.
If silver gets cut in half in price and I point out what a disaster that is, people who own silver get mad at me.
Why? I didn’t make silver fall 50%. I’m just pointing out what happened.
Same thing with marijuana stocks. People were convinced that legalizing marijuana was going to make them rich.
Meanwhile, some of those stocks went down 99%.
That’s not my fault, either.
Now look at the stock market today.
The average stock in the S&P 500 has finished the month at a new all-time high in 10 of the last 12 months.
And here we are again, with the average stock just half a percent away from another record monthly close.
Yet people still get upset when I point it out.
They’ve convinced themselves the stock market is supposed to crash, and the market just isn’t cooperating with their story.
That’s not my fault!
Remember when we were told that bonds were going to blow up? The Economist even put it on the cover of the magazine.
Well, Treasury bonds have been rallying since that cover came out.
Interest rates have been falling while people keep telling us we’re in a rising interest rate environment.
I’m not the one making interest rates fall. I’m just watching them.
And how about the death of software?
Earlier this year, we were told that artificial intelligence was going to destroy software companies. They even came up with a clever name for it.
Pretty scary stuff.
Except an equally weighted basket of more than 100 software stocks just closed at the highest levels in history.
Some apocalypse, huh?
Seems more like an apocalypse for people who don’t own software stocks.
And then there’s crude oil.
I’ve said that I think crude oil could go to $250 a barrel. Some people get furious when I say that.
But that’s just what I think could happen. I don’t know if it will. And I certainly don’t control the price of oil.
I just want to profit from the opportunity if it presents itself.
There’s an important difference here.
When I tell you that a stock is making new highs, that’s a fact. When I tell you that I think oil could go to $250, that’s an opinion.
As a technical analyst, I spend most of my time studying prices.
I’m looking at what buyers and sellers are actually doing with their money, not what somebody thinks they should be doing.
And when the facts disagree with my opinion, I have to change my opinion.
So when I write something that bothers you, ask yourself why.
Is it because I’m wrong? That’s certainly possible. I’ve been wrong plenty of times.
Or is it because the facts are getting in the way of a story you’ve already decided to believe?
Those are two very different problems.
Make Time To Think
I want to be clear about something. I’m not writing this to make fun of anybody for getting upset. Quite the opposite.
I love you guys.
I appreciate everyone who’s been reading my work over the years, sending me emails, challenging my ideas, and telling me when you think I’m full of it.
Some of my favorite conversations have come from people disagreeing with me.
When I question something you believe, I’m not attacking you personally. Most of the time, I’m questioning my own beliefs too.
That’s what all this writing is about. I’m trying to figure things out, and I’m inviting you along for the ride.
Maybe you’ve never been upset by anything I’ve written.
In that case, maybe I’m not trying hard enough.
Seriously, I think we could all benefit from spending a little more time thinking about how we think.
We’re constantly being told what to believe. There are headlines, opinions, videos, podcasts, and people screaming at us from every direction.
Everybody has an answer. Everybody knows what’s going to happen next.
But how many of those people are actually spending time questioning their own answers?
And how often are we doing it ourselves?
You don’t have to manage a portfolio for this to matter.
We all make decisions every day about our families, our businesses, our money, and how we spend our time.
So here’s something I’d encourage you to try.
Put thinking on your calendar.
Literally. Open your calendar and block off some time. Call it “Thinking.”
Go for a walk without listening to anything. Sit outside with a cup of coffee. Grab a notebook and write down whatever happens to be on your mind.
You don’t have to solve the world’s problems. You don’t even have to come up with a great idea.
Just give yourself some time to think.
And the next time somebody says something that really gets under your skin, before you fire off that angry reply, ask yourself why it bothered you so much.
You might discover something about your own thinking that you hadn’t noticed before.
After almost 20 years of writing about markets, I can tell you that some of the most valuable things I’ve learned didn’t come from finding the right answers.
They came from realizing I was asking the wrong questions.
So go ahead. Disagree with me. Tell me I’m wrong. Challenge what I write.
I welcome it.
Just make sure you’ve spent some time thinking about why.
This Week in Everybody’s Wrong
There’s a big advantage in using new technology instead of just reading about it.
On Monday, we asked what seems to me to be a pretty important question.
What are the other 98% of you doing?
On Tuesday, we explained that when we look at charts, we’re looking for patterns that tell us something useful.
We’re not just trying to see what we want to see.
So the last time semiconductors looked like this…
On Wednesday, we talked about real estate.
I’m not a housing expert, but I do look at a lot of stock charts for a living.
And there’s one we all need to pay attention to right now.
On Thursday, we welcomed Everybody’s Wrong Associate Publisher Pete Campbell for a quick look at a compelling historical trend as we get into the fourth quarter.
Stocks tend to perform well after midterm elections. Does any sector stand out? Pete broke down the historical data.
Indeed, nobody understands how we break down the stock market better than Pete.
On Friday, we brought it back to late 20th century Miami for a simple lesson about how to approach the 21st century stock market.
You can complain about AI, you can say software’s dead, you can look for more reasons why all of this is going to end badly, or you can get in the game.
“Don’t player hate. Participate.”
On Saturday, Grant Hawkridge showed once more that he’s the best data man in the business.
Whenever we need to separate the signal from the noise we hear about the market, we turn to Grant.
Here he is with a deep-dive into last Thursday’s breadth reading.
Have a great Sunday.
We’ll see you Monday morning…