Lots of smart, successful Americans inadvertently invest the Hard Way. The Hard Way is succumbing to the emotional roller coaster of news and neighbors. It’s listening to MSNBC, CNN and Fox News and having your confidence questioned by the catastrophe du jour. It is hearing neighbors and colleagues brag about silver bullet strategies or how best to time the market, and wondering if you should be following in their footsteps.
In the Hard Way, investors find this incoming information to be so arresting or compelling that they can’t help pondering how to reconcile it against their particular situation. They know they shouldn’t make knee-jerk investment changes but they can’t quite dismiss the apparent gravity of it all. On any given day, fear and paralysis can be overwhelming.