But – but – but his farm FAILED! Astounding. Dolley Madison’s father made the same mistake; after he and his wife manumitted their slaves, they sold the plantation (no one to work it), and moved to Philadelphia, where Dolley’s father, an ardent Quaker, became … a starch merchant. Yup, a man who eschewed fashion decided to specialize in luxury goods. Goods which were … going out of fashion. And, of course, the family went from self-sufficient living where they’d grown or made most of what they needed, to having to buy everything. Of course, it wasn’t long before he went bankrupt. Just like the hero of this story’s father.

I do have one problem with the piece, which i’m quite sure the author is too much of his weight in worm-food to mind, and that is his statement that one’s originating position does not matter, and that only of drive.

I belive the piece itself showed by how much this man was influenced by the opportunities his life gave him, and quite put that concept down.

I’m also a retro blogger who’s been friends with Charlie Shopsin for a couple of years. He’s one of the nicest guys on the Intarwebs. Glad you could give him a shout. And, since you’ve mentioned that you like pop culture stuff, you might want to give my blog a look. (If this kind of thing is frowned on, by the way, lemme know and I’ll cease posthaste.) Part of the way I’m trying to change my economic fortunes is branding myself, and my blog is a major part of that. It’s like James Lileks’ blog, only not as good. Here’s a link: http://dowhatnow.typepad.com.

Thanks!

The father went into nearly every venture with blinders on, not knowing fully what he was getting himself into. Calculated risk is key.

If you ask me, the father made a very poor decision based on limited information. He didn’t even understand the business he was buying. Then he made the ridiculous assumption that his expertise in farming would somehow translate into understanding the wool/hide business. Lastly, he was undercapitalized.

For example, just because you can make a great burger doesn’t mean you will experience success similar to McDonald’s. McDonald’s isn’t famous for great tasting burgers but the consistency and efficiency in their process and product.

For Rockefeller, Standard Oil didn’t become successful because it simply offered a great product. It sold oil which was only a commodity. It was just a matter of generating enough volume of business in the most efficient way. Rockefeller understood this because he had extensive expertise in commodities accounting. However, he was also an excellent manager who assembled a loyal and talented workforce. In other words, the company could still progress without him.

The defining difference between the “Wool/Hide” man and Rockefeller is that the former made decisions that only increased the probability of failure while the latter made decisions which aimed at lowering this probablity. Although we see both of them making risky investments, we also see that only one of them knew how to play the game with the odds in his favor.

“Work on your business, not IN it.” ~Michael Gerber (E-Myth revisited)

On my first reading, I also wondered what impact the Great Depression had on this man. I’m sure he was able to ride it out, but I would have been interested to read his thoughts on personal finance 10 years after this article was written.

It’s interesting how often children take the opposite path to their parents as a reaction to something negative from their childhood.

Except with his strategy statistically you are much more likely to fail (end up like the father) than have anything at all.

Big risks = big losses for almost everyone who tries that strategy (whether gambling or buying the junkiest of bonds)

I also could not help but wonder if the more conservative man would have lost his bank savings in the Great Depression. Is there a sense of hoarding, scarcity and lack of enjoyment, like the childhood baseball longing, of what he did earn due to fear? Did he truly utilize his talents with his work or hold back out of fear of loss and just settle?

Thought provoking read. Thanks for sharing. Love the photos!

By contrast, Rockefeller’s take on money was influenced by an itinerant father (a risky way of life). Rockefeller went the opposite way of the profiled gentlemen, become rich from risky investments. By the time the 1873 and 1929 depressions hit, he was able to sail through them.

I’m no economics whiz and have no idea how old the profiled gentleman was, so I wonder if his faith in gilt-edge stocks and farm mortgages remained high when the “Great Depression” hit in 1929 (as careful as he was, he would have possibly seen it coming when signs appeared in the early ’20s). My guess is that he may have suffered, but would have been able to ride it out.

Very interesting comparison of two very different men influenced by different family situations and economic times.

Fantastic!