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Jonathan Clements: If You're Not Saving, You're Losing Out
I am pleased that Jonathan Clements has come home to the WSJ. I missed his commonsense columns that were much more than just investment advice. Welcome back Jonathan.
His reintroductory article to his WSJ audience clearly shows that he will continue exploring life style issues in addition to investment topics. Clements has always believed that financial success is about more than money. In fact that’s the title of Chapter 21 in his most recent book.
The title of that book is “The Little Book of Main Street Money”. I’ve owned a copy for several years. Typical of all Clements writings, it is an informative, breezy and easy read.
I’ve hesitated to recommend it to the MFO membership because it devotes only a minor portion to investment advice. It is not sophisticated in that it covers many broad financial matters in a simplified format. It is a great introductory-like tutorial that might well satisfy the needs of very financially illiterate folks. In closing each brief chapter, Clements provides a short “street Smarts” tips section.
Clements is the only notable financial writer that I have personally met. At least 15 years ago he lived in Metuchen, New Jersey; so did my sister. On a visit, our paths accidentally crossed while walking around a lake in a State park. I believe he initiated a conversation.
We talked a little about investing. The discussion turned to decision making, and the errors that even professionals are guilty of. That allowed me to introduce my favorite sports example of faulty decisions because of not understanding the odds. I’ve told this story on earlier MFO posts, but I’ll repeat it now.
A basketball team is two points behind with seconds remaining when the coach calls a timeout. The question: Should the team try for a 2 or 3 point basket? Given typical shooting percentages, the answer is to go for the 3-pointer. Many coaches do the opposite. Here’s why.
Most teams successfully execute a 2-point shot with 50% likelihood. Given the closeness of the game, the probability of winning in overtime is also 50%. To register a win, both events must happen. Therefore the odds of winning the game are 25% (0.5 times 0.5).
Most teams have shooters who convert 3-pointers at about the 33% level. Therefore, a well-informed coach should always try for an immediate victory given those odds.
Clements really liked that story. Later, it appeared in his columns. Although I can never be 100% sure, I like to assume I influenced his writing in that singular instance.
"I’ve hesitated to recommend it to the MFO membership because it devotes only a minor portion to investment advice. It is not sophisticated in that it covers many broad financial matters in a simplified format. It is a great introductory-like tutorial that might well satisfy the needs of very financially illiterate folks. In closing each brief chapter, Clements provides a short “street Smarts” tips section"
>>>seems like a good enough reason from where I sit.........ain't much new to learn, anyway.............,eh?
I've noted before that Mr. Clements' time at Citigroup looked to me like time spent in the wilderness; I don't think they knew what to do with him and it looked like he mostly wrote an occasional blog piece for them. At least that's what was visible from the outsider and, as Director of Consumer Education, you'd think that his work would be intentionally made visible to the outside.
And now he's returned to the Journal, but not in print and he hasn't even been assigned a DowJones email address. You're asked to direct any mail about the column to an aol.com account. Curious.
And because I'm curious, I've dropped him a note about his new relationship to his old employer. I'll share what I learn.
Comments
I am pleased that Jonathan Clements has come home to the WSJ. I missed his commonsense columns that were much more than just investment advice. Welcome back Jonathan.
His reintroductory article to his WSJ audience clearly shows that he will continue exploring life style issues in addition to investment topics. Clements has always believed that financial success is about more than money. In fact that’s the title of Chapter 21 in his most recent book.
The title of that book is “The Little Book of Main Street Money”. I’ve owned a copy for several years. Typical of all Clements writings, it is an informative, breezy and easy read.
I’ve hesitated to recommend it to the MFO membership because it devotes only a minor portion to investment advice. It is not sophisticated in that it covers many broad financial matters in a simplified format. It is a great introductory-like tutorial that might well satisfy the needs of very financially illiterate folks. In closing each brief chapter, Clements provides a short “street Smarts” tips section.
Clements is the only notable financial writer that I have personally met. At least 15 years ago he lived in Metuchen, New Jersey; so did my sister. On a visit, our paths accidentally crossed while walking around a lake in a State park. I believe he initiated a conversation.
We talked a little about investing. The discussion turned to decision making, and the errors that even professionals are guilty of. That allowed me to introduce my favorite sports example of faulty decisions because of not understanding the odds. I’ve told this story on earlier MFO posts, but I’ll repeat it now.
A basketball team is two points behind with seconds remaining when the coach calls a timeout. The question: Should the team try for a 2 or 3 point basket? Given typical shooting percentages, the answer is to go for the 3-pointer. Many coaches do the opposite. Here’s why.
Most teams successfully execute a 2-point shot with 50% likelihood. Given the closeness of the game, the probability of winning in overtime is also 50%. To register a win, both events must happen. Therefore the odds of winning the game are 25% (0.5 times 0.5).
Most teams have shooters who convert 3-pointers at about the 33% level. Therefore, a well-informed coach should always try for an immediate victory given those odds.
Clements really liked that story. Later, it appeared in his columns. Although I can never be 100% sure, I like to assume I influenced his writing in that singular instance.
Best Regards.
"I’ve hesitated to recommend it to the MFO membership because it devotes only a minor portion to investment advice. It is not sophisticated in that it covers many broad financial matters in a simplified format. It is a great introductory-like tutorial that might well satisfy the needs of very financially illiterate folks. In closing each brief chapter, Clements provides a short “street Smarts” tips section"
>>>seems like a good enough reason from where I sit.........ain't much new to learn, anyway.............,eh?
And now he's returned to the Journal, but not in print and he hasn't even been assigned a DowJones email address. You're asked to direct any mail about the column to an aol.com account. Curious.
And because I'm curious, I've dropped him a note about his new relationship to his old employer. I'll share what I learn.
As ever,
David