NFL Coaching Changes
It’s a great time of year for football. The Big Ten finally won a college football national championship and the Super Bowl is fast approaching.
It’s also a time of change. I want to discuss three coaches that are no longer coaching their football teams: Nick Saban, Bill Belichick and Ron Rivera.
Saban and Belichick are legends. They've won a combined 13 championships. They are both famous for running process-driven organizations, highlighted by the mantra, “do your job.”
They have a “way” of doing things. The “way” they do one thing is the “way” they do everything1. They recruited and/or drafted/traded/signed players that fit the mold they were looking for in their system and they were highly successful.
Ron Rivera is also not coaching anymore. He coached my NFL team, the Washington Commanders/Football Team.
Since he was let go, it came out that he didn’t really implement a culture. There was no “way” of doing things. There was no leader. In an article by Ben Standig with The Athletic, he quoted a team source,”One day, Rivera would have one perspective on who should be doing what and then shift that. Vacillate back and forth. We constantly changed plans in part because Ron often chased narratives.”
That sounds like a one-ingredient recipe to be a terrible football team.
The funniest part of the article was in the title, “Winning the news conference, losing where it counts”. Riviera was notorious for losing news conferences. The most boneheaded moment he provided in a press conference is when he didn’t seem to know his team could be eliminated from playoff contention after a late-season loss. Absolutely clueless.
What can investors learn from these coaches?
When a new prospective client reaches out to me, I analyze how efficient their personal financial system is. I see too many people who treat their finances like Ron Rivera treated coaching the Commanders. No cohesive plan for the future. Sure, they have assets and are able to get by. But overall, it’s a mess.
Having a system in place with your finances will likely lead to better long-term outcomes. I wrote a whole guide about it. I want all my readers and clients to run their financial lives like Saban and Belichick ran their organizations, not like Rivera.
Catcher’s Knees
I did a product demo this week for an innovative financial planning solution. The salesman (Rob) loved my company website and clearly demonstrated that he had read some of my blog posts. That made me feel great, I highly recommend all sales people do this to build rapport.
This led us to talking baseball. He was a catcher growing up and loved it, but it wrecked his knees2. Rob expressed some regret. He wished someone had taught him how to properly squat behind the plate and how to properly lift weights to strengthen his core/legs.
I’ve been working with a lot of couples in their 20’s and 30’s/early 40’s. We work on getting started with investing and how to set up their financial system for long-term success. The service I'm providing is basically what Rob wanted for his baseball career. Whether baseball or finances, do things right early on and you won’t suffer the consequences later in life.
Traitor or Faithful?
My wife and I have started watching The Traitors (season 2) on Peacock. It’s a reality show similar to the party game Mafia. There are “Traitors” and there are “Faithful”. The secret Traitors are trying to eliminate the Faithful. The Faithful are trying to figure out who the Traitors are and get rid of them. The venue is a castle in the Scottish highlands. The winner gets prize money. Premise = fantastic.
The cast is filled with a slew of reality stars from other reality shows: Housewives, The Bachelor, Survivor, Big Brother, etc. Alan Cumming is the host and has really gone all-in with his Scottish accent and colorful outfits. It’s wonderful to watch.
Each episode there is a “roundtable”. It’s an open forum for the players to debate who they think is a Traitor. At the end of the roundtable, everyone votes for who they think is a Traitor. The player with the most votes is banished from the castle.
This public display is a perfect opportunity to witness “herd mentality” in action.
There are usually two reasons to vote for someone:
They acted or said something weird that makes them seem suspicious
You, yourself, are a Traitor and want to deflect suspicion onto someone else
So far, someone has usually acted weird or said something dumb and they get ganged up on. Traitors are happy to pile on. Faithful are willing to go with the mob as long as it’s not their name on the chopping block. If you make a strong pitch to vote for someone, you might succeed in getting that person out. But if you’re wrong about them being a Traitor, you risk being voted out next. I won’t spoil what happens, but herd mentality/groupthink is 100% on display each week.
The same thing happens in financial markets (and everywhere in life). Investors will “go with the herd” without conducting due diligence of their own when investing in a stock or employing a certain strategy.
This is how asset bubbles are created and why crashes are inevitable.
Knowing who to listen to is important. Knowing who to not listen to is equally important.
The Traitors is such a visceral example of herd mentality, and I love it.
What areas of your life does herd mentality play a part? What about your financial life and investments? Are you following the herd without doing the research yourself?
If you want your personal finance questions answered in a future Mound Visits, send me an email at nick@nineinningfinance.com with your name, location and a question/scenario.
Nothing in this email is intended to serve as financial advice. I don’t know your personal circumstances and would never provide financial advice through this medium. This newsletter is intended to be educational and entertaining. Please consult a financial professional and do your own research before making any changes to your portfolio.
Sprinkle in some “light” cheating too.
I was a catcher for a grand total of one inning in my baseball career. Not for me!