Proverbs Commentary Illustrates How to Choose Investments

Proverbs 23:4 – “Through wisdom is an house builded; and by understanding it is established: And by knowledge shall the chambers be filled with all precious and pleasant riches.”

Alrighty then. It looks to us what King Solomon is conveying to us through this Proverbs commentary is that wisdom, understanding, and knowledge are essential elements to success in business or investing. We have to look no further back into history than the so-called dot.com boom and bust of the late 1990’s to understand the basic truth in this advice.

People dove into these internet stocks left and right, piling on with a speculative frenzy that drove the price ever higher…until the air came out of the balloon and it all came crashing to the floor. Much of the problem could be traced to the fact that most people had no understanding of what the company they were buying actually did or how they planned to make money. A few, like Amazon and Ebay, managed to survive the bloodbath and are still doing fairly well today, albeit with monumentally lower stock prices than back in the day when it was measured in hundreds of points.

When looking at this Proverbs commentary (or any other) it’s good to read it for the big ideas and not worry too much about whether the phrasing survives a few thousand years of intervening language development intact. The lesson is don’t pour your money into a business endeavor or investment you don’t understand. Solomon thinks it’s dumb and God doesn’t like it. We wouldn’t want to be sitting on the other side of the fence from those two.

The Solomon Success Team

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