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Saturday, March 04, 2006

Mike Price, 15 year old investor

Mike Price runs a new investment blog here. Shai Dardashti is only a college student, but Price is even younger. That kids like this exist gives me great hope for the future.

Price looks at K-Swiss here. My only advice would be to never stop learning, never stop evaluating your own performance and looking for improvement. As Buffett says, investing is a cumulative knowledge. You get better the more you do it. The most logical way to become a better investor is to start younger. But investing is more than picking stocks. It's also where to focus your efforts, what to spend time doing.

When I was 15, my efforts were focused on being a skilled foosball player, guitar player, and motorcycle rider. These skills are worthless to me now, but the methods I used to gain the skills were valuable. All of them involved a sort of cooperative competition where a significant number of kids all attempted to improve their skills in a loosely organized, chaotic, unpredictable group. When someone accomplished something significant, others would study it and learn the technique. Sometimes people would enter the group, having come from somewhere far far away and brought with them valuable techniques we had never seen before. They would soon be mastered by all the serious participants. There were always complex group dynamics involving cooperation, competition, social interaction, and a drive among many people for achievement. It was the development of a technology.

This exact same process is how Western Civilization became so successful. Many different technologies were developed over long time periods by groups of people both cooperating and competing. Each person starts out as a know-nothing apprentice. With time and effort, they can master the art and possibly even contribute to its forward progress. The smaller the field, the more possible this becomes. I think one of the main benefits of the Internet is that it will make it far easier to for these groups to form and to improve on the state of so many of the arts and carry our civilization forward. I wonder if the rapid progress of the Renaissance was largely due to the printing press? If so, imagine what the future holds for someone like young Mike Price? Consider that the world's middle class is likely to increase by unimaginable amounts as India and China become more productive. The amount of wealth increases greatly as the amount of economic activity increases.

So welcome to the group, Mike. Investing is an old and honorable group that has done great things for humanity. This is especially apparent when one looks at the horrible consequences of small groups that attempted to hijack civilization in the name of designing it better themselves in the absence of market forces and open competition of ideas: the Soviets, the Fascists, Maoist China, the Khmer Rouge, and now the radical Islamists. They kill tens of millions, they make the vast majority worse off, and they also stop the progress of civilization. I say all this because there have been many people in the last hundred or so years that have attempted to conquer and control civilization and remove the unpredictable, uncontrolled, chaotic market forces which got us to where we are. It took the hard work of many, many generations to bring us the technology we have. There are people who would surrender all this because they feel bad about being successful while many people are not and people who would steal or destroy all this for the opposite reason. It is imperative that they not succeed.

UPDATE: In the age contest, it appears that Kevin from MarketMoney is 8 months younger than Mike Price.

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