In the spring of 2012, I stopped hesitating, and invested my money in the stock market.
I was living in Los Angeles at the time, and everything was bad around me. President Barack Obama had to deal with the greatest economic crisis since the 1930s, in addition to the Tea Party movement and the Republicans who were sinking in Congress any initiative aimed at helping the poorest people in society.
Investing in the stock market was the last thing my instincts told me to do. Every fiber of my being said no. The only reason that pushed me to invest was reading books that changed my life.
Until then, I was convinced that you had to have studied at HEC Montreal to be able to get rich through financial assets. Or, at the very least, be prepared to spend your evenings and weekends analyzing hundreds of companies, or doing complicated calculations on mysterious charts.
These books have shown me that I was wrong.
Since then, the market has gone through ups, downs, crashes. We have lived through crises and recessions. But every dollar invested in the spring of 2012 is worth almost four today.
I had my first lesson: in investing, our instincts are a poor guide.
Here are six books that over the years have changed the way I think about money. I’m not saying they’re the best, or that other books aren’t just as relevant. This is a personal list. Yours is probably different, and that’s good.
This is the investment bible. After reading this book, I have never seen the world of investing the same way again. A graduate of Princeton and Harvard, Burton Malkiel made a career as a professor of finance at Princeton University. It was in this book, first published 50 years ago, in 1973, that he demonstrated the limitations of active portfolio management and stock picking, and proposed the idea of an index fund, which would passively replicate the market. It was finally John Bogle, founder of Vanguard, who offered such a fund to the general public four years later. If you had invested $10,000 when the fund was launched, you would have over $21 million in your investment account today. Mr. Malkiel’s book has sold millions of copies and is in its 13th edition this year. You should probably read it in English: the book was translated into French a decade ago, but this edition is hard to find. It’s quite dense as reading and it’s not a beach novel, but to understand stock market investing and the mistakes made by investors, including professional investors, it’s a must.
I’m a fan of Morgan Housel: I’ve always loved his phrasalism and non-catastrophizing that are so common in the world of financial writers – the interview1 I did with him there several years gives an idea of the character. Released in 2020, his book The Psychology of Money has sold millions of copies and been translated into over 30 languages. Extremely readable and accessible, this book tackles several aspects of our relationship with money and wealth, and makes us see the subject through catchy stories that serve the author’s purpose better than a series of numbers and of tables.
Along with A Random Walk Down Wall Street, this book ignited my interest in saving and investing. Andrew Hallam is a high school teacher who grew up in British Columbia and became a self-realized, debt-free millionaire at the age of 36 – proof that a big salary is not a prerequisite for getting rich. Since then, Andrew Hallam – whom I also interviewed2 several years ago – has quit his job to lecture on money, in addition to continuing to write about finance on his blog and in various media, and traveling by bike and motor home around the world with his wife, Pele. Andrew Hallam has a knack for clearly explaining concepts that can be abstract. His most recent book, Balance: How to Invest and Spend for Happiness, Health, and Wealth, is also excellent.
Studying the life and philosophy of Warren Buffett is a must for anyone interested in finance and investing. Don’t be fooled: Warren Buffett’s grandpa looks hide one of the sharpest minds of our time, as well as a fierce competitor who knew since elementary school that he would one day be the richest man in the world. This book is overflowing with memorable quotes applicable in our daily lives.
What could be better than a book on financial freedom… written by a Quebecer who became financially free before the age of 40? Jean-Sébastien Pilotte made his mark with his blog The Young Retired, and it was natural for him to seek to take up the challenge of publishing, which he succeeded brilliantly. Jean-Sébastien Pilote guides us through all the facets of enrichment, and does it extremely well and above all with humor, which is not easy in the field of finance, often seen as dry and rigid. It was Jean-Sebastien Pilotte’s book that taught me that the person who drives a Ford F-150 pickup truck that is renewed every five years loses more than $1.5 million in wealth during his working life, a sum that many can only dream of having in retirement.
Newly launched in French by Éditons Valor, and free to download in PDF format, this book retraces the writings and speeches of the Indian-American investor Naval Ravikant3. A Silicon Valley investor who has had success with investments in companies like Uber and Twitter, as well as cryptocurrencies, Ravikant has for some years been known for his concise and clear way of speaking on a variety of topics such as happiness, ambition and psychology. The first part of the book teaches us to become rich, while the second talks about freedom, happiness, wisdom. A book that will have a particular resonance for teenagers or young adults who are wondering about the path they should take in life.
This newsletter will be closed for the next few weeks. It will be back on August 13, and will now ship on Mondays.
Good summer !