Nothing is predictable, conditions change every day
So much has changed, and there are so many uncertainties, from the financial (what’s going on with tech stocks?) to the cosmic (what will the new economic world order look like?). To make matters worse, there is no haven — not gold, not crypto, not even US Treasuries.
There is a way to manage this environment: Embrace Finance 101.
Recall the basics you learned in financial literacy class in high school, or in that one finance course you took in college, or while getting your MBA, or just from reading the classics on investing. Everything you need to know to manage this market environment is contained in a few nuggets of wisdom.
Markets are efficient after all. This does not mean that prices are always “correct,” just that they generally reflect the available information.
Diversify. The so-called Magnificent 7’s growth has been so spectacular they dominate the S&P, and their performance seemed to demonstrate that diversification was for suckers.
But hindsight is always 20/20. AOL also looked like a winner once. OpenAI could be this year’s Mozilla.
“20/20” is an eye-vision measure meaning “normal” sharp eyesight at 20 feet, so the phrase “hindsight is 20/20” means that after something has happened, we see what the right decision was with perfect clarity.
Nothing is truly risk-free, but some things are lower-risk than others.
Bond yields revert to the mean. The near-zero rates of the 2010s were never going to last.
The true lesson of Finance 101 is humility. Nothing is predictable, conditions change every day, the best you can do is decide how much risk you can tolerate and then diversify, hedge or insure.
And if the global economy continues to grow, as it has for a few centuries now, it should all work out. Even with AI.
Allison Schrager Bloomberg February 9, 2026
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