You Get What You Deserve
“Be not deceived; God is not mocked: for whatsoever a man soweth, that shall he also reap”
Galatians 6:7
As I sat in bed this morning at 5am trying to go back to sleep this aphorism (You Get What You Deserve) kept running through my mind – along with the never-ending gaggle of worthless sheep I counted before finally getting out of bed.
I have come to respect aphorisms and old sayings as well as traditions. They embody generational wisdom and have therefore stood the test of time.
“You Get What You Deserve” was a frequent refrain from parents in my era. A reminder that while watching Michael Jordan’s televised games was entertaining – it was not likely to lead to a scholarship from the university I wanted to attend. Fortunately, I grew up knowing that if I didn’t get a scholarship then I could make enough money by working. Starting at eleven, I had paper routes for the Omaha World Herald and at fifteen, a lawn business. These jobs required me to show up 7 days a week, 365 days a year, rain or shine until I attended college at 18.
I got what I deserved then (admittance to a good school but no scholarship) and in retrospect do not resent missing sports opportunities in order to deliver papers or mow lawns. I acknowledge I learned some important lessons from having to show up for work as a teenager at times (6am comes early to a 16-year-old) and years (7+) for work that I did not love. I’d like to think that much of my success as a financial advisor over the last 27 years is largely a reflection of lessons I learned as a cold eleven-year-old paperboy lugging heavy papers in the dark at 6am.
There is real value in holding a job because you need to pay bills as opposed to pursuing your life’s calling. Not just as a teenager – but also as an adult. Whether it be in auto-body shops, paper routes, mowing lawns or working at Amazon, work reinforces the principle that “you get what you deserve”! Hindu’s call it “Karma”, and in Christian scriptures it’s called “The Law of the Harvest” – the concept that we ultimately reap what we sow (Galatians 6:7).
This law is applicable to every aspect of personal as well as professional life. We largely get what we deserve as individuals – and I’d suggest it also applies to institutions…
Elections:
After every election there are many (almost half!) who are frustrated with the results. This process is what the founders intended – with the intention that elected officials would soothe the passions of the moment which sometimes seizes citizens in pure democracies. The plan was to elect representatives whose deliberations and trade-offs with opponents would produce more dispassionate legislation. But the founders recognized the experiment was fraught with danger – hence Benjamin Franklin’s response to a question on what type of government was “A republic, if you can keep it” …
We may or may not like the government and institutions we have or for that matter the people who lead them – but they are a reflection of our collective societal values. Those who would like different election results will find that their greatest influence will come by way of education in the family and wielding neighborhood influence as opposed to anger directed at opponents. Ultimately, this great country will likewise get what it deserves…
Finance:
I read this week an article in Wall Street Journal about the demise of one of crypto’s brightest stars – FTX’s Sam Bankman-Fried who as recently as last week was a billionaire. He’s worth NOTHING now – a feat only possible in the crazy world of cryptocurrencies, an “asset” with no intrinsic value.
Meanwhile in the world of traditional investments there is light at the end of the tunnel. For almost a decade the investment landscape was dominated by the likes of FAANG stocks (including Amazon, Apple, Netflix and Facebook (Meta) and Google). All mega-cap tech companies that seemingly could do no wrong and for which investors believed that no price was too high to pay. Meanwhile, Small Cap Value (or SCV) – an asset class whose virtues I have extolled frequently in this column, was wallowing as a cheap but obscure investment whose outperformance some may have believed was relegated to a previous generation.
That has all changed now. Those who patiently waited for superior returns from SCV have been greatly rewarded. The returns YTD in the asset class are, wait for it… POSITIVE! That’s 30%+ better performance than the collective FAANG competition so far this year. The law of the harvest is again vindicated – with investors getting rewarded for their patience and resolve.
Conclusion:
Not all good personal or institutional behavior is rewarded either quickly or immediately. It requires faith as an individual or institutional leader that making good decisions, sometime against prevailing views or orthodoxy will ultimately produce desired outcomes. So, belief IN a Law of the Harvest means we can be patient as individuals and institutions, knowing we may not see the desired results, but that future generations will.