How NOT to Invest, with Barry Ritholtz

Today's guest, Barry Ritholtz, became famous for spotting the two thousand and eight financial crisis before almost anyone else did. He was warning about it publicly before people were talking about it, but it wasn't because he was some Wall Street genius. It was because, as he's about to share with us, his mom sold houses. And they had these dinner table conversations when he was a kid. And so he started looking into mortgages and securitization, and very few people at the time were paying attention to the securitization market. It was this quirky little backwater of finance. In today's interview, he shares that story with us and more broadly talks to us about how not to invest. Welcome to the Afford Anything podcast, the show that knows you can afford anything, not everything. The show covers five pillars, financial psychology, increasing your income, investing, real estate, and entrepreneurship. Acronym is FIRE with two i's, double I, FIRE. Today, we are talking about the second letter I, investing, specifically what not to do. I'm your host, Paula Pant. Our guest today, Barry Ritholtz, is the founder and chief investment officer of Ritholtz Wealth Management, a financial planning and asset management firm that manages over $5,000,000,000 of asset thunder management. In addition to correctly predicting the two thousand and eight crisis, he also, on Yahoo Television, became super bullish in March 2009, right at the bottom of the market. So he he called the market bottom. Financial Planning magazine referred to him as, quote, the prickly prophet of Wall Street. The Daily Beast referred to him as one of the 15 most important economic journalists. And The Huffington Post calls him, quote, one of the 25 most dangerous people in financial media. He formerly wrote columns for Bloomberg Opinion on the markets and investing and for the Washington Post on personal finance and investing. He's a former contributor to CNBC, a guest commentator on Bloomberg Television, and the creator and host of the Bloomberg podcast, Masters in Business. He holds a JD and used to be a lawyer. If you heard our previous interviews with Nick Majuli, Barry is Nick's boss. He has brilliant insights about the markets, and he just wrote a book called How Not to Invest. So to discuss that topic with us today, here he is, Barry Ritholtz. Hi, Barry. Hi. Thank you so much for having me. Thank you for being here. When we talk about how not to invest and when we focus on how not to make mistakes, could that have the effect of making us too conservative, too risk averse? Well, it depends. I mean, let's unpack a little bit of that. First, most of us spend a lot of our time trying to figure out how to invest, how to pick stocks, how to pick funds, how to allocate assets, where we should have our money, when we should pull our money out. And it turns out that as a species, …