I am writing my column from Colorado. Our family tries to get away for a week every other year or so with my siblings and my dad. One of my siblings has a cabin in Colorado and he invited us to spend a long weekend there.
Lex is my sibling, even though not by blood. I have found that you can have siblings a number of ways. Your parents can make a sibling for you or they can adopt a sibling for you, but sometimes siblings just happen. Lex Jackson came into our lives about 40 years ago as an employee at our family business, Reed’s Department Store, and has been with us ever since.
I don’t remember when I started thinking of Lex as a brother – it just happened. I do know that when my mother and father came up with the idea of taking all of their children and spouses on a trip, there never was a question that Lex and his wife, Judith, would be coming.
So we trekked to Colorado and drove to their cabin located at 8,000 feet above sea level just outside of Pagosa Springs. We arrived to a snow storm the night before my dad’s 87th birthday. Yes – it was snowing in the middle of May. We woke up the next day and snow was in the air, snow was in the trees, snow was everywhere.
My father said something interesting while gazing at all that snow.
“I have never before seen snow on my birthday,” he said.
Well, dad loves to travel and has been to some pretty interesting places. He has also been around for 87 years, so I thought this was a “Black Swan event.”
We have heard a lot about Black Swan events in the past few years. I have seen many articles and books written on them. So I looked up the definition of a Black Swan event.
Investopedia says it is “an event or occurrence that deviates beyond what is normally expected of a situation and that would be extremely difficult to predict.” Wikipedia says Black Swan events are “rare events that are beyond the realm of normal expectations in history, science, finance and technology.”
Many people want to tell you how to prepare for the next Black Swan event. My question is, “Why would anyone waste much time trying to figure out the next big event when by definition that event is something almost impossible to predict?” Even if you are right, timing your rightness makes it even less probable that you will be able to take advantage of it.
Our society seems to believe that nothing happens without our permission. Bad things happen because we caused them. Good things happen because we caused them. I heard a meteorologist who was talking about the recent tornados in our area. Someone asked him if global warming had anything to do with it. He said that he always was amazed at how egotistical we humans can be thinking that we cause everything.
My advice is to spend your time working to control the things you can control. Make sure your portfolio is in a position to take care of you no matter what happens in the normal cycle of events. Don’t beat yourself up over things you didn’t do that would have prevented your exposure to things you could not predict. That, in my mind, is fool’s play. Bad things happen to good people all the time. They may even happen to you. But planning for that will prohibit you from making good choices time and time again.
I heard Lou Holtz, the famous college football coach, say that he expected five bad things to happen in every season that were out of his control. He said he didn’t start worrying until the sixth bad thing happened. But people are selling books every day to a public frantic to find out how to avoid the next Black Swan event, like the one that happened to us in 2008.
Don’t get caught up in fool’s play. Make good decisions based on reasonable expectations and accept the fact that you can’t control everything. Good luck.
Scott Reed, CIMA, AIFA, is CEO of Hardy Reed in Tupelo.