Page 122 - Morgan Housel - The Psychology of Money_ Timeless Lessons on Wealth, Greed, and Happiness-Harriman House Limited (2020)

Two dangerous things happen when you rely too heavily on investment
history as a guide to what’s going to happen next.
COBACOBA

1. You’ll likely miss the outlier events that move the needle the most.

The most important events in historical data are the big outliers, the record-
breaking events. They are what move the needle in the economy and the
stock market. The Great Depression. World War II. The dot-com bubble.
September 11th. The housing crash of the mid-2000s. A handful of outlier
events play an enormous role because they influence so many unrelated

events in their wake.

Fifteen billion people were born in the 19th and 20th centuries. But try to
imagine how different the global economy—and the whole world—would
be today if just seven of them never existed:

Adolf Hitler

Joseph Stalin

Mao Zedong

Gavrilo Princip

Thomas Edison