The Long View – Barry Ritholtz: “How Not to Invest”

Released: October 7, 2025
Hosts: Christine Benz, Amy Arnott
Guest: Barry Ritholtz, co-founder, chairman, and CIO, Ritholtz Wealth Management; author of “Bailout Nation” and “How Not to Invest”

Episode Overview

This episode centers on avoiding the typical investing mistakes that destroy wealth, drawing on Barry Ritholtz’s decades of experience as an investor, financial writer, and podcast host. The conversation spans behavioral finance, media diet, the dangers of forecasts, secular market cycles, the pitfalls of consumption-shaming advice, and the value of time and experience over mere returns. The tone is often witty, direct, and open, as Ritholtz provides both practical guidance and memorable anecdotes from his career.

Key Discussion Points & Insights

Barry Ritholtz’s Evolution as an Investor

• Origins & Academic Foundations ([02:33])
  • After law school and time as a trader, Ritholtz’s shift towards long-term investing was gradual and rooted in understanding how media and psychology influence decisions.
  • On his early media habits: “It became pretty clear that was all emotion. The evolution from a trader to a long term investor took place slowly over the next decade.” ([02:33])
  • Behavioral economics opened his eyes to mistakes and overconfidence: “What really turned me from a trader into a long term investor was going down the behavioral economics rabbit hole and realizing how wrong I was about so many things and completely unaware of it.” ([03:38])

The Writing—and Podcasting—Habit

• Time Management & the Power of Writing in Public ([04:15])

  • Ritholtz has written over 43,000 blog posts and nearly 1,000 columns, thanks largely to a commitment to daily writing.
  • Early writing served both as personal development and as a knowledge-sharing tool, evolving from Yahoo GeoCities to WordPress.
  • “Writing in public not only gets you feedback… it was really fascinating writing that way.” ([06:24])

• Podcasting Genesis & Motivation ([07:59])

  • Frustration with superficial questions on financial TV inspired him to start Masters in Business in 2014.
  • “What sort of questions would you have asked? Hey, how did you develop your investment philosophy? Who are your mentors? ... Teach them to fish. Like, who are you? And how did you get that way?” ([08:34])
  • He relishes the opportunity to have deep conversations with financial luminaries—“the most fun I have all week.” ([09:42])
  • Memorable episodes include Ray Dalio (noted for its depth and candor) and Ken Feinberg (moving story of disaster resolution and 9/11 compensation). ([10:54]–[15:06])

The Central Role of Inversion and Mistake Avoidance

• Concept of Inversion (“How Not to Invest”) ([15:06])
  • Heavily influenced by Charlie Ellis’s “Winning the Loser’s Game” and Charlie Munger.
  • “In the amateur game, the winner is simply the person who makes the fewest number of errors. And Charlie Ellis appropriately pointed out that investing is the same way.” ([16:27])
  • Most investors lose money not through lack of big winners, but via “unforced errors” like overtrading, ignoring costs, and chasing trends.

The Folly of Forecasts and Embracing the Unknown

• Forecasting Fallacies ([18:36])

  • “Nobody knows anything”—people gravitate toward experts’ predictions for comfort, but both laypeople and experts are poor forecasters.
  • “The more specific a forecaster is, the more the viewers or readers like them.” ([20:22])
  • Even when experts get famous for a single accurate prediction, they tend to be wrong more often in the future. Cites Philip Tetlock’s research: “The average expert is no better than the average layperson in making forecasts, and the average layperson is no better than a roll of the dice.” ([21:20])

• Forecasts’ Utility—Or Lack Thereof ([22:09])

  • Increases in media and social media have made us more “aware” of forecast failures, but they've always been bad.
  • “Forecasts are great if you want to drop a ticket and charge a commission. But for someone who's buying and holding a portfolio… forecasts 12 months out, they're less than useless, they're destructive.” ([23:47])

The Superpower of Admitting "I Don't Know"

• Intellectual Honesty and Fraud Detection ([26:01])
  • Developing intellectual confidence to admit uncertainty is a superpower.
  • “Anybody who responds to the question, I don't know, with derision and ridicule, I don't want to say they're a fraud, but they're certainly not worthy of your money. Jeff Skilling was a fraud and Ken Lay was a fraud. … If you don't understand it, then don't put your money into it.” ([28:28])

Bad Numbers and Denominator Blindness

• Numerator vs. Denominator ([29:04])
  • Media sensationalizes by giving headline numbers without context—e.g., “fund lost a billion dollars,” “10,000 layoffs”—which are meaningless without the denominator (total assets, total workforce).
  • “If the fund that lost a billion dollars was a $2 billion fund, that's a horrific shellacking. But if they're a giant fund with $100 billion in assets, that's daily noise.” ([30:02])
  • “Denominator blindness is how [media hype] manifests anytime we're talking about numbers.” ([31:38])

Market Cycles, Valuation, and Investor Behavior

• Secular Market Cycles ([32:25])

  • Long cycles are driven by societal and economic changes, not by bursts forecastable in advance.
  • Markets are buoyed or tempered by valuation changes (earnings multiples), not just earnings growth.
  • Cautions against fixed definitions (like “+20% is a bull market”) ([36:36])
  • “If you sold on that 20%, not only did you incur giant taxes… then there's the question of how do you buy back in when everybody is panic selling? … They lack the discipline.” ([37:52])

• Valuation: Matters, But Not as Much as You Think ([38:55])

  • Valuation is a “reveal” of where we are in a cycle, not a timing signal.
  • “If you only buy stocks when they're cheap, you get these narrow windows every decade or so.… [but] dollar cost averages do much better because of the advantage of compounding.” ([40:26])

Politics, Confirmation Bias, and Bad Behavior

• Politics and Investing Don’t Mix ([41:45])

  • Emotional investment decisions tied to political outcomes are regularly wrong.
  • “Anything that is emotional is a bad basis for making a decision.” ([43:15])
  • Recalls erroneous predictions tied to both left- and right-wing leadership eras.

• Confirmation Bias and the Importance of Disconfirmation ([44:52])

  • Encourages actively seeking out smart, opposing viewpoints to test your beliefs.
  • “If you're forecasting the end of the world, you have to be able to explain why the world isn't going to end and why the economy and stocks are likely to go higher.” ([46:37])
  • Names Jim Bianco and Cliff Asness as favorite “intelligent dissenters.”

Personal Finance, Consumption, and Time Allocation

• Critique of Consumption Shaming (‘Latte factor’) ([48:46])

  • Strongly opposes financial “scolds” who advocate extreme frugality.
  • “If $5 is the difference between well funded retirement or not, then something else is wrong with what you're doing.” ([49:32])
  • The right advice is to “live within your means”—not to avoid all enjoyment. Also advocates for investing in modern safety for your family rather than penny-pinching on essential things like reliable cars. ([54:25])

• On Time as the Ultimate Resource ([57:32])

  • Draws on Oliver Burkman’s book “4,000 Weeks”—life is “insultingly brief.”
  • “Money isn’t a way to keep score… Money is simply a tool… it frees you up to spend the time that you have on this planet doing what you want with the people you love.” ([59:28])
  • Advocates using money to buy time and meaningful experiences, not just things ([60:59])

Notable Quotes and Memorable Moments

• On the secret to avoiding investing mistakes:
  “Instead of trying to score that ace, if you just focus on avoiding mistakes, you're going to be way ahead of 90% of your peers who are trying to operate outside of their skill set and their competency.” – Barry Ritholtz ([17:51])

• On forecasts and expert overconfidence:
  “The average expert is no better than the average layperson in making forecasts, and the average layperson is no better than a roll of the dice.” – Barry Ritholtz ([21:20])

• On acknowledging uncertainty:
  “You have to have some degree of intellectual self confidence to say, 'I don't know.'” – Barry Ritholtz ([26:26])

• On consumption shaming:
  “If you're a middle class or above earner and your bills are covered and you're saving for retirement and you want to buy a latte, who cares … why are we focused on the pennies when the hundreds of thousands of dollars are problematic?” – Barry Ritholtz ([49:32])

• On time versus money:
  “Money isn’t a way to keep score... Money is simply a tool… it gives you optionality, it gives you choices. It frees you up to spend the time that you have on this planet doing what you want with the people you love.” – Barry Ritholtz ([59:23])

Timestamps for Important Sections

• [02:33] – Barry’s career path, evolution from trader to long-term investor
• [04:15] – Writing discipline, early blogging, and its feedback loop
• [07:59] – The origin and enjoyment of podcasting
• [10:54] – Memorable “Masters in Business” podcast interviews (Ray Dalio, Ken Feinberg)
• [15:06] – Inversion, Charlie Ellis, and mistake avoidance in investing
• [18:36] – Forecasting failures and why they persist
• [22:09] – Recent years and the increasing public awareness of bad forecasts
• [26:01] – Admitting ignorance as an investing “superpower” (examples: Enron, Theranos)
• [29:04] – “Bad numbers” and denominator blindness (media math tricks)
• [32:25] – Secular market cycles, drivers, and the PE multiples story
• [38:55] – Valuations: when they matter (and don’t)
• [41:45] – Politics, emotions, and investing mistakes
• [44:52] – Confirmation bias and the need to challenge your own beliefs
• [48:46] – Critique of anti-consumer advice and the true role of budgeting
• [57:32] – Valuing time and experiences over material accumulation

Final Thoughts

This episode is rich in applicable wisdom for investors of all types. Barry Ritholtz underscores that investing success comes more from avoiding mistakes than from finding big wins; that forecasts are alluring but nearly always wrong; that both media and personal biases can derail good judgment; and that our use of time, more than our accumulation of wealth, should drive critical life and financial decisions.

The episode is a call to humility, skepticism, intellectual honesty, and a celebration of well-lived experiences—delivered with humor, candor, and actionable advice.