Treating the Bear Market Like Prison Sentence
You have to decide what to do with your time while you wait
Adam Carolla had a great piece of advice back in the day on one of his podcasts that always stuck with me. Early in the days of the Adam and Drew Show, a listener called in to tell the guys about a rough breakup he was going through. The advice given stuck with me all these nine years later which boiled down to this:
You’re going to have times in life that just suck. You have to treat those times in life like a prison sentence for a crime you didn’t commit. Basically, you’re going to be out of the game for six months to two years depending on the circumstances. You’ll be locked away.
So you now have a decision to make: you can eat the prison slop and indulge in all of the anger/sadness/frustration of the situation with all the other inmates that’ll listen to you. Then, when parole comes up, you’ll walk out of there 20 pounds heavier with bad skin and a bad attitude.
Or
You can use that time and think, “I’m going to do 100 pushups a day and camp out in the prison library getting a law degree”. You’ll still be miserable either way, but this way you’ll walk out of there ripped and with a law degree.
I’ve cleaned up the story a bit, but that advice for going through anything difficult has been immensely helpful. Especially in bear markets, its being resigned to the fact that you have some time to serve, no easy way out. So as the markets took a tumble in 2022, I found myself in the metaphorical prison cell. I don’t think I consciously knew what I was doing, but I decided to use that time in the most productive way I could:
That spike in 2022 was a realization that I had no where to go, no amount of trading would get me out of this situation and I just had to wait it out, so get comfortable and get reading (2022 list below):
It was also the birthplace of this Substack, all 55 posts later:
What’s been really interesting was to see how well the prison metaphor works here, especially as the world got small again and thanks to today’s access to information, we’re all able to see how everyone else is handling it. More importantly though, I’ve learned how little I knew about many things back at the end of 2021, or at least it feels that way, funny what clarity a downturn can bring.
I want to emphasize how helpful the mental framing of a prison sentence in these times works so well. By taking off the table that there is some quick and easy way home (back into the green if you will), it refocused me onto what my true options were, and what was the best action I could take. To be clear, the option to just throw my hands up, curse the sky and shut things down was always there, I just see that as a lost opportunity to really develop and grow as an investor and a person. This bear market is a gift wrapped in bad paper, but a gift nonetheless.
So 2023 picked up where 2022 left off, still more sideways action on the surface, but the undercurrents of true utility, growth, friendship and betterment. Its just not all visible yet, but it will be. If you’re in here with me, we still have some time to serve, so I’m working through my stack of books until the time comes (2023 so far):
So when parole comes up and its time to head out, I hope to be a much better investor than when I went in. As I’m writing this latest piece in my metaphorical prison cell, its another day closer to parole, and man I’m feeling more optimistic.
Will