The relationship between glaciers and billionaires

What does the ice age have in common with the formation of billions in wealth?

At first glance, nothing. However, in my opinion, Morgan Hausel made a good analogy in his book “The Psychology of Money” (I will post my impression of the book later).

So, back to glaciers and billionaires. There is a theory that ice ages (and there were 5 of them in total) began when a layer of snow did not melt completely as a result of cool summer. The snow fell again in winter, did not melt completely in summer, fell again in winter and so on for a certain period, such a layer of snow and ice was formed that it became a threat to all living things. Therefore, a small amount of unmelted snow and constant freezing led to the disaster.

Now about Warren Buffett: he started making his first investments at the age of 10. From the age of 30, his steady income growth was 22% annually. His current fortune is 84.5 billion, and most of it was accumulated after 60 years. That is, he started early with a small amount and constantly (note the keyword here), for three-quarters of a century, increased his income. By comparison, Jim Simons has been increasing his profits by 66% annually since 1988 (he has not achieved equal results yet), three times as much as Buffett, but his total wealth is 75% less than Warren's. The reason is that he started his successful investment activity after 50 years. The secret of big fortunes is time and constant, though not the highest, profit during this longest time.

And as with the glacier, it doesn't take a lot of strength to get extraordinary results. Even a small starting base can lead to results so remarkable that they will not be logical.

In the end, we have the parameter "Money": consistency, tenancy, equability. According to the criterion "Psychology": calm, perseverance, understanding of purpose, balance, and confident faith in the correctness of their actions.

Zoryana Golovata.

Leader of the expert group on cognitive management