The four most dangerous words in investing are: 'this time it's different.'
Core idea
The core idea is that investors repeatedly ignore history, believing new conditions invalidate past lessons, which leads them to underestimate risk and repeat old, costly mistakes.
Practical application
In real life, remember markets follow recurring cycles, so study past booms and crashes before investing, instead of assuming new trends or technologies make old risks disappear.
Why it matters
Templeton spotlights a timeless bias: investors rationalize bubbles as unique, dismissing historical parallels, thereby amplifying risk and repeating avoidable errors despite abundant evidence of recurring market patterns.
