Morgan Housel: Too Smart; How Trader Joe's $2 wine became a best-seller; The role of luck; Visiting Carlo Cannell on Fire Island; Climbing Mt. Whitney
1) I enjoy the writings of blogger and venture capitalist Morgan Housel, who last year published an excellent book, The Psychology of Money: Timeless Lessons on Wealth, Greed, and Happiness. Here's one of his recent blog posts: Too Smart. I hate to admit that I've fallen into some of these traps... Excerpt:
There are situations where people become too smart for their own good, where intelligence is a liability and blocks good decisions.
A few causes:
- The ability to create complex stories makes it easy to fool people, including yourself.
- What's boring is often important and the smartest people are the least interested in what's boring.
- Intelligence can make it difficult to communicate with ordinary people, who may have the missing insight you're looking for.
2) I enjoyed this story about Trader Joe's "Two Buck Chuck" wine, which sells for $1.99 per bottle. It has sold more than one billion bottles since its debut in 2002! How Trader Joe's $2 wine became a best-seller. Excerpt:
Walk into almost any Trader Joe's store and you'll spot a behemoth display of Charles Shaw wine – or, as it's more affectionately known, "Two Buck Chuck."
Priced at a mere $1.99 to $3.79 per bottle, this magical ether is cheaper than most bottled water. It's been knighted as the "darling of the discount wine world" by critics, and boasts a cult following among price-minded consumers.
For Trader Joe's, the wine is also a gold mine.
The grocery chain has sold 1B+ bottles of Two Buck Chuck since debuting the beverage in 2002. Today, some locations sell as many as 6k bottles/day – or ~16% of the average store's daily sales.
How is a supposedly decent wine sold at such a low price point? Where does it come from? And how did it rise to prominence?
This is the tale of one wine brand, two vintners, and the unlikely democratization of a historically snobby industry.
3) These two stories remind me how big of a role luck plays in life...
Lottery winner throws $26M ticket in the laundry. Excerpt:
This is not the best way to launder money.
A lotto winner who bought a winning $26 million SuperLotto Plus ticket at a California gas station last year accidentally washed away her winnings in the laundry.
4) Longtime readers may recognize the name Carlo Cannell of hedge fund Cannell Capital, who spoke at a number of my Value Investing Congress conferences and is an old friend. He invited Susan and me to visit him for an afternoon last week at Fire Island, which I'd never been to and which Susan had only been to once 15 years ago.
We made the ferry with 30 seconds to spare (very stressful!), biked a bit, walked in the dunes and on the beach (see pics below), played some tennis, and had a barbecue on the water with Carlo, his partner Rebecca, his friend Rafael (whom I videoed jumping into Corbet's Couloir at Jackson Hole on April 2 – it has nearly 4,000 views), and his wife Eleni. A wonderful day all around!
Here are a few of my favorite pictures:
For the story behind the bathrobe picture and Susan pronouncing the village in Wales on the bottom sign, Llanfairpwllgwyngyllgogerychwyrndrobwllllantysiliogogogoch, check out my Facebook post here.
5) My guide and I summited my namesake, Mt. Whitney – the tallest mountain in the continental U.S., at 14,505 feet. (See my July 23 e-mail for details on my climbs to raise money for my favorite charity, KIPP charter schools – here's the donation page.)
After a tough initial slog (more than four hours, up 4,000-plus feet, carrying 45-pound packs), we blazed up the East Buttress route in three hours. Here are some pictures:
Best regards,
Whitney
P.S. I welcome your feedback at WTDfeedback@empirefinancialresearch.com.