A Dozen Things Someone Might Learn about Investing and Business from the Simpsons

You can learn as much from anti-role models as role models. Knowing what not to do is valuable. While Homer and other characters in the Simpsons are often among the more classic anti-role models, they are sometimes role models on issues like family loyalty.

1. HOMR-

Broker: “Okay, now before I execute this order, are you sure you understand the risks of stock ownership?”

Homer: “Absolutely!” [picture of Homer’s brain appears that includes a line of dancers line singing ‘We’re in the money’. ] “You heard the monkey, make the trade.”

The stock market will not deliver wealth to you, especially if you expect it to appear on some sort of schedule. That you can determine an asset is mis-priced now relative to intrinsic value does not mean you can time when the asset will rise to a price that is at or above its intrinsic value. The best investors wait for profitable result, rather than try to time markets.

2. Homer vs. Patty and Selma-

pumpkins

Homer: “This year I invested in pumpkins. They’ve been going up the whole month of October and I got a feeling they’re going to peak right around January. Then bang! That’s when I’ll cash in.”

This dialogue from the Simpsons reminds me of Nassim Taleb’s story about the turkey: “Consider a turkey that is fed every day. Every single feeding will firm up the bird’s belief that it is the general rule of life to be fed every day by friendly members of the human race ‘looking out for its best interests,’ as a politician would say. “On the afternoon of the Wednesday before Thanksgiving, something unexpected will happen to the turkey. It will incur a revision of belief.” Here’s a chart depiction of Taleb’s story:

taleb-thanksgiving-turkey

3. Lard of the Dance-

Homer Simpson: Okay, boy. This is where all the hard work, sacrifice, and painful scaldings pay off.

Employee: Four pounds of grease… that comes to… sixty-three cents.

Homer Simpson: Woo-hoo!

Bart Simpson: Dad, all that bacon cost twenty-seven dollars.

Homer Simpson: Yeah, but your mom paid for that!

Bart Simpson: But doesn’t she get her money from you?

Homer Simpson: And I get my money from grease! What’s the problem?

Marge: Homer! That side of bacon was for my bridge game tonight!

Homer: Marge, if you don’t mind, I’m a little busy right now achieving financial independence.

Marge: With cans of grease?

Homer: [sarcastically] No! Through savings and wise investment. Of course with grease.

Homer doesn’t understand what Bill Gates said once in his famous Playboy interview: “Take sales, take costs, and try to get this big positive number at the bottom.” July 1994

4. Homer the Vigilante-

Homer Simpson: “Aw, you can come up with statistics to prove anything, Kent. Forty percent of all people know that.”

Charlie Munger makes the same point in his own unique style: “Without numerical fluency, in the part of life most of us inhabit, you are like a one-legged man in an ass-kicking contest.”

5. Bart Gets an Elephant-

Homer: “Look at this Marge, $58 and all of it profit. I’m the smartest businessman in the world.” Marge: “[The elephant’s] food bill today was $300” Homer: “Marge, please, don’t humiliate me in front of the money”

Homer is operating this business at a negative gross margin.

6. No Loan Again Naturally-

foreclosure

Homer: “It’s a secret thing called a home equity loan. I get all this cash…and the house gets stuck with the bill!”

Homer: “When you gave me that money, you said I wouldn’t have to repay it ’til the future. This isn’t the future. It’s the lousy, stinking now!”

Leverage can be a very dangerous thing. Next to liquor and drugs is it one of the most common sources of ruin.

7. The Flight Before Christmas-

Krusty: “Kid, this company’s bust. For years I’ve been giving away free toys and getting cookies in return. It’s not a sustainable business model.”

Krusty clearly has a problem with his business model and what he generates as income is insufficient to even recover his cost of goods sold.

7. The Old Man and the Lisa-

Mr. Burns: “I’ll keep it short and sweet. Family, religion, friendship. These are the three demons you must slay if you wish to succeed in business.”

Mr. Burns: “Smithers, why didn’t you tell me about this market crash!” Smithers: “Um, well… sir, it happened 25 years before I was born.” Mr. Burns: “Oh, that’s your excuse for everything!”

Lisa [to Mr. Burns]: “If I did agree to help you, you could only earn money by doing good, socially responsible things. Nothing evil.” Mr. Burns: “Nothing evil. That’s exactly the kind of radical thinking I need!”

Charlie Munger: “I think you’ll make more money in the end with good ethics than bad. Even though there are some people who do very well, like Marc Rich–who plainly has never had any decent ethics, or seldom anyway. But in the end, Warren Buffett has done better than Marc Rich–in money–not just in reputation.”

8. Kamp Krusty-

Homer: “Son, if you really want something in this life, you have to work for it. Now quiet! They’re about to announce the lottery numbers.”

This is a Charlie Munger riff on another point made above: “If you don’t get this elementary, but mildly unnatural, mathematics of elementary probability into your repertoire, then you go through a long life like a one-legged man in an ass-kicking contest. You’re giving a huge advantage to everybody else.”

9. The Twisted World of Marge Simpson

Marge: “I’m not wild about these high-risk ventures. They sound a little risky.”

Other woman: Tsk. Oh, Marge. You are such a wet blanket. If we’d listened to you, we wouldn’t have sponsored that Mexican wrestler.

Andy Rachleff on Angel Investing: “Everywhere I go in Silicon Valley I hear people discussing their angel investments. The conversations remind me of fish stories. People love recounting the one time they caught a big fish, not the many futile hours they spent waiting for a bite.”

10. Lisa’s Date with Density-

Homer: “Greetings, friends. Do you wish to look as happy as me? Well, you’ve got the power inside you right now. So, use it, and send one dollar to Happy Dude, 742 Evergreen Terrace, Springfield. Don’t delay, eternal happiness is just a dollar away.”

Homer: “Now we just sit by the mailbox and watch the money roll in.”

Marge: “But you’re going to annoy thousands of people just to make a few measly dollars. It’s nothing but panhandling.”

Homer: “Hello, this is Homer Simpson, AKA Happy Dude. The court has ordered me to call every person in town to apologize for my telemarketing scam. I’m sorry. If you can find it in your heart to forgive me, send one dollar to Sorry Dude, 742 Evergreen Terrace, Springfield. You have the power.”

This dialogue reminds me of this:

Jerry Sienfeld: This isn’t a good time.

Telemarketer: When would be a good time to call back, sir?

Jerry: I have an idea, why don’t you give me your home number and I’ll call you back later?

Telemarketer: Umm, we’re not allowed to do that.

Jerry: Oh, I guess because you don’t want strangers calling you at home.

Telemarketer: Umm, no.

Jerry: Well, now you know how I feel.

11. Pulpit Friction-

Homer is offered a job as the new church deacon and says: “Well, I’m not one for taking new jobs on a whim. But as we say in the snow plow business, I’m your astronaut.”

Avoid “ready fire aim” decisions in life and you will have a better life. Charlie Munger: “Just avoid things like racing trains to the crossing, doing cocaine, etc. Develop good mental habits.” “A lot of success in life and business comes from knowing what you want to avoid: early death, a bad marriage, etc.”

12. $pringfield-

casino

Mr. Burns: “I’ve discovered the perfect business. People swarm in, empty their pockets, and scuttle off. Nothing can stop me now.”

Burns: “By building a casino, I could tighten my stranglehold on this dismal town!”

Smithers: “Sir, bad news from accounting: the economy’s hit us pretty hard.” Burns: “Heh, tough times, huh? I’ve lived through twelve recessions, eight panics, and five years of McKinleynomics. I’ll survive this.”

Gambling is net present value negative. Because it can become an addiction, it can produce real harm. Charlie Munger: “I knew a guy who had $5 million and owned his house free and clear. But he wanted to make a bit more money to support his spending, so at the peak of the internet bubble he was selling puts on internet stocks. He lost all of his money and his house and now works in a restaurant. It’s not a smart thing for the country to legalize gambling [in the stock market] and make it very accessible.”

Addendum:

Mr. Burns: “What good is money if you can’t use it to strike fear into the hearts of men.”

Mr. Burns: “I’ll bide my time. Revenge is a dish best served cold.”

Mr Burns: “Eternal happiness for one dollar eh? Hmmm, I’d be happier with the dollar.”

Krusty the Clown: “Kids, we need to talk for a moment about Krusty Brand Chew Goo Gum Like Substance. We all knew it contained spider eggs, but the hantavirus? That came out of left field. So if you’re experiencing numbness and/or comas, send five dollars to antidote, PO box…”

Milhouse: “I can’t go to juvie. They use guys like me as currency.”

Krusty: “Here’s the deal. Every time you watch my show, I will send you… forty dollars! Voice: Checks will not be honored.”

Herbert Powell: [watching `Itchy and Scratchy’] “To think I wasted my life in boardrooms, and stockholders meetings, when I could’ve been watching cartoons!

Homer: “The three little sentences that will get you through life. Number 1: Cover for me. Number 2: Oh, good idea, boss. Number 3: It was like that when I got here.”

Homer: “How is education supposed to make me feel smarter? Besides, every time I learn something new, it pushes some of the old stuff out of my brain. Remember when I took that home wine making course, and I forgot how to drive?”

Marge: “The plant said if you don’t come in tomorrow, don’t bother coming in Monday.” Homer: “Woo-hoo! Four day weekend!”

“Marge, don’t discourage the boy! Weaseling out of things is important to learn. It’s what separates us from the animals! Except the weasel.”

“Lisa, if you don’t like your job, you don’t go on strike. You just go in every day and do it really half-assed. That’s the American way.”

“Don’t struggle! You’ll only sink faster.”

“I think Smithers picked me because of my motivational skills. Everyone says they have to work a lot harder when I’m around.”

“Bart, you’re saying butt-kisser like it’s a bad thing!”

“I can’t believe it! Reading and writing actually paid off!”

“Mr. Scorpio says productivity is up 2%, and it’s all because of my motivational techniques, like donuts and the possibility of more donuts to come.”

“Now go on, boy, and pay attention. Because if you do, someday, you may achieve something that we Simpsons have dreamed about for generations: You may outsmart someone!”

“Trying is the first step towards failure.”

“Hello, Jerry? Homer Simpson. Remember last month when I paid back that loan? Well now I need YOU to do a favor for ME.”

Notes:

HOMR- https://en.wikipedia.org/wiki/HOMR

Homer vs. Patty and Selma– http://www.drodd.com/simpsons-quotes/6-17.htm http://www.simpsonsarchive.com/episodes/2F14.html http://www.springfieldspringfield.co.uk/view_episode_scripts.php?episode=s06e17https://en.wikipedia.org/wiki/Homer_vs._Patty_and_Selma

Lard of the Dance- http://www.imdb.com/title/tt0701117/quotes

http://www.imdb.com/title/tt0701149/quotes

Bart Gets an Elephant- http://www.springfieldspringfield.co.uk/view_episode_scripts.php?episode=s05e17 http://www.simpsoncrazy.com/episodes/bart-gets-an-elephant

No Loan Again Naturally- http://www.springfieldspringfield.co.uk/view_episode_scripts.php?episode=s20e12http://simpsons.wikia.com/wiki/Bart’s_Inner_Child/Quotes

The Flight Before Christmas- http://simpsons.wikia.com/wiki/The_Fight_Before_Christmas

The Old Man and the Lisa- http://simpsons.wikia.com/wiki/The_Old_Man_and_the_Lisa/Quotes

Kamp Krusty- http://simpsons.wikia.com/wiki/Kamp_Krusty/Quotes