Bon Jovi, Tiger Woods & South Sea Company.
“The more things change, the more they stay the same”
The same sunrise; it’s just another day
If you hang in long enough, they say you’re coming back
Just take a look; we’re living proof, and baby that’s a fact
You know the more things change, the more they stay the same
The more things change, the more they stay the same”
-Bon Jovi
Bon Jovi is one of my favourite bands of all time. While listening to this song last night struck some chords on why some things appear to be changing, and still they don’t change. Like Pakistan, the country had another change in government, 22 Prime Ministers since 1947 and no one completed the full term. So many things have changed, and yet nothing has changed.
“The more things change, the more they stay the same”. This saying is credited initially to french writer Alphonse Karr who wrote it in 1849. In some ways, it’s a manifestation of the “recency bias” we have.
Tiger Woods has had many career firsts over the last 26 years, yet he is trying to orchestrate another fascinating fairytale of comeback & redemption at the Augusta Masters. Barely a year ago, the world was shocked by the news of a terrible car accident involving woods, with rumours of him never being able to play golf again. There were even doubts about whether he will even be able to walk again or not, But people like Woods are different, battered, yes, maybe, but broken, Nah!
While his body has changed after the accident (a metal rod has been inserted in his tibia and a few screws), not his will & desire to win, he recently said, “I can swing a golf club,” Woods said. “The walking’s not easy, and it’s difficult. As I said with all the hard work, my leg, it’s going to be difficult for the rest of my life. That’s just the way it is, but I’m able to do it.” And Woods still believes that he can win. The more things change, the more they stay the same.
I visited my hometown, Jaipur, after quite some time. On the face of it, the city has changed a lot in the last many years since I haven’t been there, but the feeling & connection was still the same. The sense of belonging was the same. Friends were warm & open. Everything was the same; I just had to look keenly. It reminded me of this passage from Stephen King’s book “Revival” — “The drive north to Castle County was slow, but not because of traffic. I had to look at every old landmark — the farms, the rock walls, Brownie’s Store, now closed and dark — and marvel over them. It was as if my childhood were still here, barely visible under a piece of plastic that had become scratched and dusty and semi-opaque with the passage of time.”
Many of us have heard about the South Sea company. The company was given a trading monopoly for a loan to the government. The bill enabled the company to make interest on the loan given to the government and profit from the trade. It was termed a public-private partnership and hence appeared like an excellent investment, and everybody wanted to own some shares of it in a frenzy.
Even Issac Newton also had some financial misadventures with it. Everyone expected the stock price only to go up because that had happened in the recent past. The bubble burst in 1720, and the share price collapsed. It’s been more than 300 years, yet this event is still discussed, finds umpteen mentions in books related to behavioural finance, and has been a topic of continued interest for students of financial markets & investing. Why? Because many things have changed in financial markets & investing over the last many years, our recency bias has not. The more things change, the more they stay the same.
The more things change, the more they stay the same. Many things change, and there will be many that will never change. Embrace it.
