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Life and finance lessons from the Vancouver Winter Olympics

Posted by admin on March 5, 2010 in editorials

I normally don’t post on Friday but I wanted to remind readers today is your last day to enter to win a free copy of QuickTax tax preparation software. To win, please post a comment in this week’s post announcing the draw. Winner announced Monday.

The Vancouver 2010 Winter Olympics drew to a close on Sunday night.  Everyone I knew who was there came home and got sick. Must have been quite a party! The problem with the coverage of the Olympics, any Olympics, is that they are subject to such hyperbole during the event and then quickly forgotten right afterwords for the next greatest event this century.  But these types of events always hold life and financial lessons for me. There are two I will take away from these games (Chasing Prosperity shares her lessons as well).

Firstly, life never occurs in a straight line. The script for these games was that Canada was going to dominate skiing, skating, the sled events, hockey and curling on route to winning the most amount of metals under the Own the Podium program. Canada fell flat on its face in skiing (literally and figuratively), a poor skeleton competitor ended up sobbing on national television apologizing to the nation for not winning and the Canadian men’s hockey team were taken to overtime by Switzerland and beaten by the Americans in the round robin.

Yet, Canada won the most amount of gold medals in any winter Olympics winning medals in events no one expected Canada to metal. Canada did, indeed, own the gold podium but not in a manner anyone expected. The morale of the story being that sometimes going from point A to point B is not a straight line but full of unexpected twists and turns.

Similarly, expectations of investing returns do not always go from expectation to result and getting what you want often does not happen in the way you thought it would turn out. The only thing to do at this point is make your adjustments (changing goalies or changing investment strategies) and keep plugging away.

The other lesson that came to light is the media’s growing obsession, in the 24-7 tabloid age, to create a story which is often wrong. Some members of the media questioned whether Canada would win enough medals and were calling the Olympics a disaster before the games were half over. Canada did very well in the medals count and most observers, even the grumpy English reporters, admitted that Vancouver threw a great party.  This seemed to shine light on the fact that some members of the media are taking the a small sample size of something, anything, and trying to blow it up into a story- even before the story has really developed.

Traditional media is in a tough bind. The internet has pulled the rug out from under them. To be relevant is to break a story and to break it faster than TMZ. It does not necessarily matter if the story is right. Just that it is broken and you grab attention.

In personal finance, we have whip sawed from terms such as  “economic miracle”, “unrivaled historical growth”, “never ending good times,” to “depression”, “bubbles”, “economic collapse” in a short period of time. Both sets of terms were hyperbole to the extreme.

Things are never as good as a salesperson makes it to be or as bad as a lawyer would have you believe. I sometimes think we may be better off as investors not reading the headlines and going straight to the financial reports.

Have a great weekend.