Simple vs. Easy
Thoughts as of 3/3/2024
Funnily enough, the first time I heard the distinction between simple and easy was in a film shown in a theology class in high school. The movie had religious implications and the lesson taught by this particular scene has been lost on me, but it has been, and will continue to be quite profound.
In order to discuss the distinction in more detail, I think that it would be helpful to define both terms and the distinction at the outset.
In this context, simple can be defined as a synonym for uncomplicated, whereas easy can be defined as a synonym for unchallenging. Something that is simple is not difficult to grasp intellectually, while something that is easy is not difficult to execute.
Once this difference is made apparent, it starts to reveal itself across many different areas in life. The difference between words and deeds, thoughts and actions, “do as I say, not as I do.”
One such instance is investing.
When I first got my job at a hedge fund, I was scrambling trying to learn all I could about finance, starting with reading Investopedia for what a hedge fund even was. This path inevitably led me to the school of value investing a la Warren Buffett and Benjamin Graham.
From the outside looking in, it seems so obvious. Buy things for less than they are worth, and don’t buy things that are being sold for more than they are worth. Be fearful when others are greedy and be greedy when others are fearful. Simple!
But unfortunately, as I was to find out, not easy. I did not realize this at the time through my own journey, but rather when a friend was attempting to break into the realm of finance and was starting her own learning journey. Upon stumbling on value investing, she said “this is literally so obvious, how did these people get rich doing this?”
I chuckled to myself and first thought of how much she had to learn, how naive. And then immediately after, thought - well now wait a minute, that’s a good point.
"Take a simple idea and take it seriously." -Charlie Munger
Easy to say, hard to do. I have been trying to be less of a coward lately and actually act on my stated beliefs instead of just musing over them and proclaiming to others how high and mighty I am.
In reality in investing, it does not have to be very complex. Numerous studies have shown the efficacy of investing consistently in low-cost index funds over time (simple) and avoiding changing your game plan in periods of euphoria or extreme pessimism (not easy).
Many financiers have made their fortunes by making things more complicated than they need to be, convincing folks that they need a Ph.D. to understand what a stock is, and that they would be better off just paying someone else to manage things on their behalf.
There are many different areas in life where this distinction comes up, but most saliently for my life (aside from this investing anecdote) is in the realm of diet and exercise.
Everyone knows that we should generally eat healthy foods, avoid unhealthy foods, and do some sort of cardiovascular exercise and resistance training. Simple!
But then we walk into the grocery store and see aisles of junk food and billions of marketing dollars screaming for our attention, and it becomes far less easy.
In the realm of exercise, going on a walk, doing a few pushups or bodyweight squats, and moving around after a day of sitting at a desk all seem pretty simple! And yet, we get convinced into thinking that we have to go to a fancy gym and have a personal trainer for any of it to be worth it.
Just like the crafty financiers, we see fitness influencers on social media taking all sorts of equipment like kettlebells, resistance bands, exercise balls ad infinitum to make you think, oh actually THAT is what I needed to incorporate into my workout.
In these instances and others I have thought about, keeping it simpler often makes it easier, while complicating things decreases the likelihood of successful execution.
There is no overarching thought or profound conclusion to tie up this thought, but it has been something that is on my mind and I have seen crop up unexpectedly. Perhaps over time, there will be something more robust that comes from this line of thinking.