People who know me know I’m a musician, in a blues band, and a big fan of great musicians. But the second night of the Grateful Dead farewell tour Sunday night in Santa Clara, California, which I attended, was a special moment in time.
Yes, there’s just five of them left (if you count Bruce Hornsby). Yes, the tour arrangements have been controversial and rough around the edges. But you don’t spend decades with fans who literally travel town to town to see you and then just hang it up without a goodbye.
If you’ve never been to a Dead show, you have to understand that the music and the actual show are just part of an amazing ad hoc culture of freewheeling showmanship, fandom, commerce, kindness and everything under the sun. Usually in a parking lot and always a party.
It reminds me a lot of my generation: The baby boomers broke a lot of rules. We tended to make up life as we went along and that little bit of chaos changed the world in so many ways. Life was a series of rough drafts, yet things worked out great.
I live today in the fairly buttoned-up world of investing, but that radical streak is hard to ignore. Yes, I went to Harvard Business School, but now I find myself breaking the rules of investing, trying to bring change where it has been needed for many years.
That’s what I love about indexing and portfolio rebalancing. It seems so conservative and safe, even boring.
Yet, underneath it all lies a truly radical concept: When you find a process that works, like the Dead did, keep doing it over and over. Soon, good things start to happen.
If you’re going to invest, you have to live with at least some freewheeling chaos. You have to learn to ignore a lot of sharp people who seem absolutely sure that one stock or another is going up or down. You have to reject the authority that the news media seems to command and, instead, do what works.
The Grateful Dead had a process, one which was radical for its time. They gave away their music, letting fans tape shows and trade copies freely. Decades before the Internet, they totally understood viral marketing.
Their money came not from selling records but from live shows. If you talk to working bands today, that practice has become the norm. YouTube and Spotify are marketing channels that nearly force musicians to give away music, so instead they turn a profit on concerts — like the Dead did for three decades, until the death of guitarist Jerry Garcia.
This is a group that built a fan base so large that after two decades of not playing they have been able to sell out five nights and gross an estimated $20 million. Amazing.
More than money
Interestingly, it is the “sameness” of Dead shows that drives their uniqueness. Playlists changed, of course, but every show has a beginning, a middle and an end. Every show is different but the same. Fans can’t get enough of it.
Investing for retirement, I have learned, is less about certainty (which nobody owns anyway) than about finding that repeatable process and sticking with it. Own index funds, keep costs down, rebalance with discipline and enjoy the results. It’s simple, repeatable investing.
Once you hammer down a good process, your money compounds and grows into something more than money, something transcendent — the freedom to do what you like with your time and even to leave a legacy to your children.
