Sir John Templeton's Wisdom and Keeping an Open Mind

Sir John Templeton was one of the greatest investors ever. He was a pioneer of mutual funds and has donated millions through philanthropy and charity. As you read about Templeton, you learn one thing: he was deeply philosophical. As evidence of that he once wrote the following about the universe:
"In spite of the enormous strides made by science and the incredible power of our new instruments to reveal the secrets of the universe, large and small, we must accept in all humility that our knowledge is still limited. We cannot even be sure that the vast universe unveiled to us by our telescopes is all that exists. There may be other regions of the universe far beyond the reach of our instruments having very different properties. It is even possible that entire other universes co-exist in parallel with our own." - Sir John Templeton
The benefits to having an open mind like this are numerous. It means you are receptive to change and possibility. It means you lack stubbornness. Together, this is an essential trait for not only life but also financial market success. When markets swiftly change direction, for example, you need to be receptive. You need to act accordingly. He reiterates this to some degree in his book, Investing The Templeton Way:


Exploring Markets Blog

Ray Dalio On Why Depressions Happen and What It Means

One of Ray Dalio's masterpieces is titled, “Template for Understanding.” There are countless wisdoms within this document. One section seems to have paramount importance today. That is when he begins to speak about why depressions happen what causes them. Think about how this might relate to today, or even past crashes you've witnessed:
"In deflationary depressions/deleveragings, monetary policy is typically ineffective in creating credit because interest rates hit 0% and can’t be lowered further, so other, less effective ways of increasing money are followed. Credit growth is difficult to stimulate because borrowers remain over-indebted, making sensible lending impossible. In inflationary deleveragings, monetary policy is ineffective in creating credit because increased money growth goes into other currencies and inflation hedge assets because investors fear that their lending will be paid back with money of depreciated value." - Ray Dalio
He goes on to say:
"The long-term debt cycle top occurs when 1) debt and debt service levels are high relative to incomes and/or 2) monetary policy doesn’t produce credit growth. From that point on, debt can’t rise relative to incomes, net worth and money supply. That is when deleveraging – i.e. bringing down these debt ratios – begins. All deleveragings start because there is a shortage of money relative to debtors’ needs for it. This leads to large numbers of businesses, households and financial institutions defaulting on their debts and cutting costs, which leads to higher unemployment and other problems." - Ray Dalio