October 31, 2025

In my experience, accountability has four requirements:

• Truth
• Timeliness
• Legibility
• Storytelling

No lies or errors. Reveal what you know as soon as it’s pertinent. Put it where people who might think it’s useful will see it or can find it with little effort. Explain it in the most inviting and succinct way possible.

In this year’s March and April newsletters, I wrote about investments that I made. It’s time to see how I did.

Let’s start with what investing is and why we do it. By which I mean, investing in stocks.

When you buy a share of stock, you become one of the owners of the company. If you buy a share of the Coca-Cola Company for $70, you own one of its 4.3 billion shares.

• You get to vote for its board of directors.
• When Coca-Cola sends its annual dividend checks, you will get $2.04.
• If someone offers to buy the company for $100 per share, you can vote on the offer.
• If this theoretical sale happens, you get $100 for your share.

Why does a share of Coca-Cola cost $70? That’s the equilibrium between where people want to buy it and sell it. In the short run, the stock market Is a voting machine. In the long run, the stock market Is a weighing machine.

“Voting” means that sometimes people get excited about stocks (e.g. GameStop). It means that stocks, and entire markets, are prone to bubbles and crashes.

“Weighing” means that, over time, companies’ prices and their value tend to correspond. Over time, the price of Coca-Cola should match its value.

What do I mean by value? In a word, “earnings”. That’s the money that Coca-Cola has left after it pays its expenses.

The company sells a lot of Coke, which makes it a lot of money: $47.7 billion last year. Its expenses included employees, taxes, interest on debt, ingredients, packaging, and advertising. What it has left is earnings. Last year, per share, it had $3.02 in earnings. A lot of that went to dividends. The rest went back into the business.

When you think about a company’s value, you think about its earnings:

• What it will earn next year, the year after, and so on.
• What it will pay in dividends.
• What a buyer might pay for it (also a function of earnings).
• What Coca-Cola might do to increase its earnings (AI! Protein!).
• What might cause Coca-Cola to have lower earnings (Tariffs! Panics!).

What if most investors think Coca-Cola’s earnings will grow faster than “the market”? Then there will be more buyers than sellers. If that happens, the price goes up (e.g. Nvidia) until there is a new equilibrium. The opposite happens if a lot of people think Coca-Cola’s earnings will trail the market average.

Making and acting on these projections is what stock analysts do for a living. Stock analysts tend to be smart and obsessive. If you are not good at projecting companies’ earnings, it might be a bad idea to buy stocks. When you buy individual stocks, you are trading with professional stock analysts.

If you are bad at stock analysis, you should buy mutual funds or exchange-traded funds (ETFs). The professional investors who operate these funds tell you how they’re going to invest. If they invest in stocks, they tell you what theme or strategy they will follow. Their goal is to buy stocks whose prices increase faster than the stocks they don’t buy.

People who are bad at choosing stocks aren’t much better at choosing fund managers. This, too, is a full-time job for smart, obsessive people. For instance, professionals who manage endowments get paid to pick good fund managers.

The alternative is to pick all the professional investors. Stock trades involve a buyer and seller, so professional investors as a whole tend to do as well as the market. Many funds let you buy the entire market or a part of the market.

The S&P 500 is a collection of big companies that mirrors the entire U.S. market. The Russell 3000 is the same idea, only with more companies. Or you can buy a collection that’s meant to do the same thing for the largest non-U.S. companies. There are a lot of collections.

These collections (e.g. S&P 500, Russell 3000) are “indexes”. Buying the stocks in an index is dead simple for fund companies (e.g. Vanguard, Fidelity, BlackRock). So it costs you less to invest in index funds than in funds where a person or team make each decision to buy or sell. These “managed” funds cost more because you’re paying for expertise.

I discussed two different managed funds earlier this year, one in March, the other in April. Small teams of well paid specialists make decisions about each stock in these funds:

• Joel Greenblatt, Robert Goldstein, Michael Venuto, and Charles Ragauss manage Gotham Short Strategies ETF (SHRT)
• Cliff Asness, Michele Aghassi, Andrea Frazzini, John Huss, and Laura Serban manage AQR Long-Short Equity Fund (QLENX)

Greenblatt and Asness write a lot. I understand what they and their teams will do and why, so Beth and I are keeping our money in these funds.

Were these good decisions?

In the March 31 newsletter, I wrote about Gotham Short Strategies ETF. If you decided to invest in that ETF the next day, you could have bought it when the market opened on April 1 for $8.16 per share. It’s now worth $7.28, a -10.78% return on investment, and a -17.76% annualized return.

By comparison, the second largest ETF, iShares Core S&P 500 ETF (IVV), an index fund, opened at $560.02 on April 1. It’s now worth $685.23, a 22.36% return on investment, and a 41.31% annualized return.

If you are into ESG investing, the largest ESG ETF is iShares ESG Aware MSCI USA ETF (ESGU). This index fund opened at $121.45 on April 1. It’s now worth $149.62, a 22.19% return on investment, and a 42.97% annualized return.

I was off by about 60% on an annualized basis. “Annualized” is the way most of us think about these kinds of things. When you make 4% interest in your savings account, that’s annualized. As is the 7% interest on your mortgage or the 20% interest on your credit card.

Off by 60% is awful. How about the other fund?

In the April 30 newsletter, I wrote about AQR Long-Short Equity Fund. If you decided to invest in that fund the next day, you could have bought it when the market opened on May 1 for $17.20 per share. It’s now worth $19.58, a 13.84% return on investment, and a 29.50% annualized return.

The iShares Core S&P 500 ETF (IVV) opened at $563.02 on May 1. It’s worth $685.23, a 21.71% return on investment, and a 47.96% annualized return. The iShares ESG Aware MSCI USA ETF (ESGU) opened at $122.30 on May 1. It’s worth $149.62, a 22.34% return on investment, and a 49.50% annualized return.

I was off by about 30% annualized. Oops?

In April, I included a Howard Marks quote: “…being too far ahead of your time is indistinguishable from being wrong.”

Ahead of my time or wrong. You decide. Anyway, I’m stubborn. Plus, who doesn’t love a bit of cognitive dissonance?

Here’s what I see:

1. Signs of a Bubble: Schiller PE Ratio. When stock investors “vote” to spend a lot for companies’ earnings, that often precedes a crash. Investors are paying over $40 for each $1 of earnings. That’s the second highest amount in history. (Counterpoint by Jonathan Ping, one of my favorite personal finance writers.)
2. Signs of a Bubble: Gold. Investors buy gold when they’re worried about inflation and crashes. Gold is at an all-time high.
3. Signs of a Bubble: Bitcoin, Bitcoin, Bitcoin. Cryptocurrency is a bet that others are stupider and greedier than you. (They aren’t.) At least tulips are lovely.
4. Investing requires facts.

In March and April, I ended my introduction with the same three paragraphs, that I will repeat again:

None of this is investing advice. Never make an investment based on what you read in this newsletter. Or any newsletter. I know you and you know better.

I have shared this information because I want to be transparent. Writing helps me think through the implications of my beliefs. Maybe what I’ve written will help you.

If you feel confident in U.S. markets and America, this could be an opportunity for you to adjust your allocations. If you don’t, you might think about what that means for your finances.

Note: I got my data from Yahoo Finance. I ran my numbers through the Return on Investment (ROI) Calculator

Welcome to October 2025’s Disappearing Moment, an inventory of my experiences. I hope you enjoy it.

Podcast

Our New York Table (I Liked It): When I am stressed, I like to eat food, watch food, and listen to food.

Nerdy Software

Writing Month is here for your NaNoWriMo (RIP).

Free Font

Erewhon comes from Utopia via Heuristica, which means nothing to any of us. It’s a nifty font from the crazy world of Michael Sharpe.

Bougie Products

Body Glide. If you know, you wish you didn’t.

Personal Finance and Investing

Cancel the subscriptions you don’t need. If you can afford it, sponsor independent writers, publishers, or podcasts. Fuck Substack.

Reading

• Mikl Em, “Long Now Years: Five-digit Dates and Y10K-compliance at Home” (I Liked It): Nerdy and optimistic, like me.
• Brian Grubb, “Louvre Heist Top Five” (I Loved It): This happened on October 19. I learned about it on October 27. Just in time.
• Karen Hao, Empire of AI (2025) (I Loved It): Comprehensive, damning, and a page turner. Fuck OpenAI.
• Wendy Herlich, “The Jury Man” (I Loved It): My kind of short story.
• Annalee Newitz, Automatic Noodle (2025) (I Loved It): Not subtle. Neither were my tears.
• David Rosenthal,“The Gaslit Asset Class” (A Personal Favorite): It’s libraries all the way down.
• Wikipedia, “Thank you to Fuzheado and Pharos” (I Loved It): Chilling and lovely.
• Sarah Wynn-Williams, Careless People (2025) (I Loved It): Say it with me: Fuck Zuckerberg. If you use Facebook, Instagram, WhatsApp, I hope there’s a god to help you and bless your heart.

Literary Journal

Jet Fuel Review has beautiful design, discerning editors, and is free to access. Also: thoughtful (form) rejection letters. Now I’m more determined.

Survey

To see the survey and respond to it, you have to subscribe via email and answer it through an email interface.

Last month’s question: “How many short stories do you read each year?”

Not only do y’all not read short stories, y’all don’t answer surveys about them. Only three answers this month, all “1–5.”

No shame from me. That’s how I would have answered before September. If you follow the links in my Reading section, you’ll start reading one short story each month.

Bobbing for Roberts

• Bobby Altman
• Robert Brown
• Bobby Carlyle
• Bob Downey, Jr.
• Bob Englund
• Bob Frost
• Sir Robert Geldof
• Robert Hull
• Injustice Roberts
• Bob Johnson
• Bob Kennedy, Jr.
• Bobby Lowe
• Robert Marley
• Robert Newhart
• Bobby Oppenheimer
• Bob Plant
• Bobby Quine
• Robert Ross
• Robert Seger
• Bob Tables
• Bobby Uecker
• Robert Villa
• Bob Wilson
• Robert Xavier
• Robert’s Your Uncle
• Bobby Zimmerman

See also: Backlund, Barker, Clarke, Costas, Cousy, Darin, De Niro, Dole, Duvall, Feller, Fischer, Fripp, Gibson, Goulet, Griese, Gronkowski, Guillaume, Hope, Hoskins, Jindal, McFerrin, Mitchum, Mould, Mugabe, Orr, Parish, Pattison, Redford, Saget, Sands, Schumann, Seale, Smith, Stevenson, Warren, Zemeckis

Thanks to Jake for her help with this month’s list. And thank you for spending a few moments with me.

I appreciate you and look forward to corresponding again next month.

Brett

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