"Buy boats during droughts, buy carts during floods"... Sima Qian's three stages of wealth and contrarian thinking

To accumulate massive wealth, one must go beyond simply working diligently and saving; it requires "contrarian thinking" and "decisiveness" to read the flow of the times and choose paths that others do not take. The various cases of wealthy individuals appearing in Sima Qian's "Records of the Grand Historian," specifically in the "Biographies of Merchants," offer significant implications for modern investors.

The 3 Stages of Wealth: From Labor to Asset Investment to Reading the 'Moment'

According to a video from the YouTube channel 'Understanding: All the Knowledge in the World', the process of wealth formation can be largely divided into three stages. The first stage is when one is empty-handed, securing seed money through employment and savings via physical labor. The second stage is after accumulating a certain amount of property, using one's intellect and wisdom to engage in asset investment while taking risks. The final third stage is the stage of '機好爭時' (reading the opportune moment), where one reads the flow of massive opportunities appearing in the era and bets boldly. The video explains that most people who have achieved great wealth succeeded at this final stage.

A representative case demonstrating this 'eye for the moment' is 'Tak' from the State of Zhao. When the State of Zhao fell to the Qin dynasty, most citizens tried to stay by using bribes to settle nearby. At that time, there was a region called 'Gamhaeng' near the State of Zhao, and people attempted to settle there by giving bribes, much like staying in places like Suji or Bundang. However, Tak judged that there were no opportunities on the path everyone else was taking and chose to migrate to another region with his family. He discovered iron ore in the Shu they arrived in, and by securing a monopoly on iron ore at the onset of the transition from the Bronze Age to the Iron Age, he was able to become a tycoon commanding 2,000 servants. This is interpreted as a case of capturing the changes of the era by choosing the path others did not take.

"The wealthy always use extraordinary methods"... Securing one's own competitiveness

Through the "Biographies of Merchants," Sima Qian emphasizes that "there are no fixed industries for wealth, and there are no fixed owners for goods." To support this, the video introduces various figures who became wealthy through farming like Jin Yang, accumulating wealth through gambling like Hwan Bal, or through peddling, oil vending, and even skills like sharpening knives or treating horses. Specifically, it is said that Ong Rak-seong became wealthy as a peddler, Ong Baek as an oil vendor, Jang Sil-han collected ten million coins by selling beverages, and Tak Sil-han accumulated enough wealth to command mounted attendants by selling dried sheep stomachs. Additionally, a person named Jang Ri had excellent ability in treating horses and lived a life like a nobleman, to the extent of ringing a bell to announce meals. This shows that the source of wealth is not limited to specific occupations.

Of particular note is the concept of '富者必用奇勝' (the wealthy always use extraordinary methods). It suggests that it is difficult to achieve great wealth through only '致生之 程度' (the degree of earning a living), which is simply saving and using one's body diligently. The video explains that those who became wealthy invariably utilized their own extraordinary and unique methods (Gi-seung). In other words, the process of thoroughly honing one's own talents or skills that others do not possess to make them a competitive advantage is essential. The video explains this by citing an example of a student who majored in Persian in college and secured employment at a foreign bank based on that rarity. Based on their Persian language skills, the student earned income by working part-time as an interpreter for Middle Eastern workers in Itaewon, and subsequently lived a successful life after being specially recruited to a foreign bank in charge of settling Iranian crude oil payments or transferring funds for foreign workers. This suggests that there are often no answers on the path everyone else is taking.

Fan Li's Contrarian Investment: "Buy boats during droughts, buy carts during floods"

The figure who best demonstrates the principle of contrarian investment is 'Fan Li', a minister of the State of Yue. He helped King Goujian, who had been defeated by the State of Wu, by 'Sleeping on Brushwood and Tasting Gall' and waited 20 years to succeed in his revenge, but afterward, realizing the danger of 'The Hound Is Cooked When the Hare Is Caught', he left the king without lingering attachment and became a free man. The video explains how Fan Li built wealth after becoming a free man alone, and introduces the maxim he left behind: "Buy boats when there is a drought, and buy carts when there is a flood." This is the principle of contrarianism: buying goods at a time when demand has plummeted and prices have dropped, and selling them when demand returns and prices rise. It utilizes the principle that during a drought, boats are not needed so prices become cheap, and during a flood, carts are not needed so prices become cheap.

Similarly, the case of Muyeom is mentioned, who earned a large sum of money by boldly lending funds during a wartime crisis when no one else would lend money. Ultimately, the core of wealth lies in discovering opportunities and moving at moments when others are afraid or not paying attention. Through the numerous cases of wealthy individuals recorded by Sima Qian, the video suggests that rather than merely staying within the realm of diligence, the decisive factor in creating great wealth is the courage to hone one's own unique skills and read the flow of the times (the 'moment').