Stock picking and the art of motorcycle maintenance

“Why else would people pay fortunes for some things and throw others in the trash pile? Obviously, some things are better than others ... but what's the betterness? ... So round and round you go, spinning mental wheels and nowhere finding anyplace to get traction. What the hell is Quality? What is it?”

“The past exists only in our memories, the future only in our plans. The present is our only reality."

― Robert M. Pirsig, Zen and the Art of Motorcycle Maintenance

The futility of trying to consistently predict the future is well documented. Our emotional and behavioural biases, coupled with the complexity of the world, makes it virtually impossible. In a highly respected essay, Seven Sins of Fund Management (Google it and you’ll find it), written by James Montier of GMO when he was at Dresdner Kleinwort, forecasting was sin number one. James noted, “An enormous amount of evidence suggests that investors are generally hopeless at forecasting. So, using forecasts as an integral part of the investment process is like tying one hand behind your back before you start.”