As an investor, the economic big picture should be something you think about all the time. But in bad times, you want to be twice as wary. A rising tide lifts all boats, they say, which is to say, in good times a strong market is going to let you make out on even very middling investments. But you can’t get away with fluff during bad times. That’s when you need to be tuned into everything going on — monetary policy, regulatory changes, the investment climate, the economic numbers, political and economic headlines, but not the day-to-day events so much as the important trends.

What are the giveaway words/phrases that a pseudo-economist would throw at me? So that I can guard against such people, you see.

We talk about some of them in Mobs, Messiahs, and Markets. Phrases like “stocks for the long run,” “buy and hold,” and “the American dream” are slogans that make sense a lot of the time. But not all of the time. Mass thinking can’t make that distinction. Unfortunately, mass thinking is what mass man does best. In fact, it’s all he can do.

He can never see the nuances of things, the complexity. Give him a good idea and he’ll botch it into inanity. Hand him an intuition and he turns it into a regulation. It’s a matter of taste, of knowing how far to go with things. Mass man lacks taste. A pair of shorts might be a useful outfit in the garden in summer, for instance.

But wear it to the opera or to a Sunday wedding, and you’ve proved yourself a rube. And someone who shows up in the same economic get-up, in season and out, is a financial rube. He isn’t thinking. He is self-medicating.

Do solutions to all problems need complex modelling and formulae that fill economics books? Can we handle things in a commonsense way?

Yes we can. The fallacy behind thinking we need complex mathematical models to make investment decisions lies in the two words you used in your question. “Solutions” and “handle.”

Ask yourself first if you are trying to “solve” something or trying to “handle” it. I’d say that an investment decision is not a “solve” issue but a “handle” issue. You need to know enough to go on, yes, but you’re not writing a doctoral dissertation on the subject. Or laying to rest every question on it for all time. I doubt you could, even if you wanted to. But people have a prejudice in favour of abstract knowledge, whether it’s useful or not.

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