Scott Bessent: Good Investors Know When To Put An Idea “Back On The Shelf”
In an interview on “The Master Investor” podcast with Wilfred Frost, Treasury Secretary Scott Bessent explains why great investors must resist “endowment bias” and sometimes put their best ideas back on the shelf.
WILFRED FROST, HOST: Let’s dive into one of your famous trades, if we will. You mentioned ERM, but I kind of was more interested actually in your yen trade, 2010s to early 2020s. The yen was very strong, it was below 80. You rode it for a decade as it weakened to 150 or so. What did you see in the 2011 or 12, whenever it was you started the trade? What did you see then that others didn’t see? TREASURY SECRETARY SCOTT BESSENT: Well, and this goes back to timing, that I think in psychology, a big psychological bias is called endowment bias. So you’ve worked on something, so you want to implement it. And I think one of the strengths my team and I have always had is the ability to put something back on the shelf, do an immense amount of work, and then just say now is not the time.
