Once upon a time there was a Chinese farmer whose horse ran away. His neighbors said this was most unfortunate. The farmer replied, “Maybe.”
The next day the horse returned with seven wild horses. The neighbors called it great fortune. The farmer again said, “Maybe.”
The following day, the farmer’s son was thrown while trying to break one of the horses and broke his leg. The neighbors called it horrible. The farmer responded, “Maybe.”
The next day conscription officers came to draft young men into the army, but rejected the son because of his broken leg. The neighbors called it great news. Again, the farmer said, “Maybe.”
Alan Watts explained that nature is an integrated process of immense complexity, and it is impossible to know whether an event is good or bad because we cannot know all the consequences of misfortune or apparent good fortune.
Investing can feel like a roller coaster. With so many ups and downs, it can be hard to understand whether what is happening now is actually good or bad.
-Paul R. Rossi, CFA