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The Psychology of Money

Timeless lessons on wealth, greed and happiness

By Morgan Housel


Lesson #1 - No one’s crazy

Your personal experiences with money make up maybe 0.000000001% of what’s happened in the world, but maybe 80% of how you think the world works.

Experience

“People from different generations, raised by different parents who earned different incomes and held different values, in different parts of the world, born into different economics, experiencing differnet job markets with different incenti”ves and different degrees of luck, learn very different lessons.

“some lessons have to be experienced before they can be understood” - Michael Batnick

“Our findings suggest that individual investors’ willingness to bear risk depends on personal history”

Finance is new

“Money has been around a long time. But the modern foundation of money decisions - saving and investing - is based around concepts that are practically infants.”

“The entire concept of being entitled to retirement is, at most, two generations old.”