5 Laws of Gold: Value of Wisdom

The author is not a financial advisor or formally qualified in financial matters.

This article is the third in a series of articles on the ‘5 Laws of Gold’ based on George S Clasons’ The Richest Man in Babylon. If you would like to learn more, please consider picking up copies of any of the books mentioned in this article from your local library or independent bookstore.

Throw out your conceited opinions, for it is impossible for a person to begin to learn what [they] think [they] already know.

Epictetus, Discourses

5 Laws of Gold: Value of Wisdom

Gold clingeth to the protection of the cautious owner who invests it under the advice of [those] wise in handling it.

Previously, I discussed the phrase George S Clason coined in his work, The Richest Man in Babylon, “pay yourself first”: namely, paying yourself 10% of your take home wages. I have also discussed previously the concept of making your money work hard for you and the nature (and power) of compound interest. This article will discuss the third ‘Law of Gold’ in The Richest Man in Babylon: learn from those wise in the ways of money.

Back to school

…Be not too confident of thine own wisdom in entrusting thy treasures to the possible pitfalls of investments. Better by far to consult the wisdom of those experienced in handling money for profit. Such advice is freely given for the asking and may readily possess a value equal in gold to the sum thou considerest investing.

Arkad, the titular ‘richest man in Babylon’, is visited by boyhood friends who have asked of Arkad how he learned of money as ‘they had the same teachers, and lived in the same slums’ of Babylon as youths. Arkad recounts his own journey of where he learnt about money with his mentor Algamish, a camel trader and wealthy merchant of Babylon.

Arkad’s journey to monetary enlightenment began as a humble scribe, etching clay tablets for merchants and low-ranking government officials for 2 coppers per tablet. (Remember, in this time period where Clason tells his parables, hardly anyone can read or write and, from what we know of ancient Babylon survives to us from clay tablets.)

Algamish is one such customer of Arkad; scribing receipts of silver (not unlike the oldest complaint letter ever written) as well as receipts of sale. Arkad asks Algamish how he too may become rich. The years’ long relationship and the tests Algamish sets for Arkad are best told in Clason’s olde-biblical prose, so I won’t attempt to retread ground which is best experienced for yourself here.

It is from this relationship with a mentor; learning from someone who has succeeded in becoming wealthy where Arkad learns himself and subsequently becomes wealthy themselves. “Without wisdom,” says Arkad to his own friends, “gold is quickly lost by those who have it, but with wisdom, gold can be secured by those who have it not.”

Plainly: to get better at something you need to learn more about it, you need to take active steps to become rich if you want to become rich.

To me, Seneca, Stoic philosopher, wealthy playwright and, statesman from the court of Nero says it best:

Why should I demand from fortune that she should give me this and that rather than demand from myself that I should not ask for them?

Knowledge is power

I previously wrote about my own, early journey for a mentor on ‘how money worked’ and how fruitless my endeavours for a mentor had been. This meant simply that I needed to find other mentors and they have taken the form of books, YouTube videos and, as always, the lessons from my own experiences.

I looked for experts on money and becoming wealthy and I did not need to look far: the web is full of would-be millionaires, billionaires and, financial influencers (finfluencer — I’ve never hated a word as much as this one). Opinions and charlatans are in ready supply, use your best judgement to avoid both wherever possible.

This is when I reached for Scott Pape’s The Barefoot Investor — what may be one of the most easily accessible and practical guides to understanding your money. Perfect for an amateur like me. From here, I broadened into some of the ‘big names’ in the finance self-help/get rich books; such as Robert Kiyosaki. While Rich Dad, Poor Dad is a neat story, it’s not practical for my purposes: namely, commercial property development is more of a late-game tactic for a millennial with $0 to their name. Not exactly a good place to start.

This is when I happened upon both The Richest Man in Babylon and, The Intelligent Investor at an independent bookshop.

I liked the look of Clason’s The Richest Man in Babylon because:

• it was really thin (~140 pages) and,
• I thought it was really from 4,000 years ago. It’s not, it’s just written in the same style as many of the classics.

The Intelligent Investor got my attention for almost the exact opposite reasons:

• it was really thick (587 pages including appendices) and,
• it had a quote from Warren Buffett on the front claiming it was “the best book on investing ever written.” Very, very real.

Mentors and teachers need not be people you speak to in person, they are more often those you read on a page, or you see in a video online. The only rule I had set for myself when learning about money after engaging some of the ‘get rich quick’ types, was that I would go for works which were published decades ago. Work that has stood the test of time, or the kind of work where any potential politics has died with the author so that any assessment of the information could be as objective: it either works or it doesn’t.

Learn so that you can teach

The Babylonian King saw that while his domain was the wealthiest in all the known world, his people were largely poor and struggling to make ends meet. He could not understand why, so he sent for Arkad to explain how his people could become wealthy.

“Arkad”, said the King, “our city is in a very unhappy state because a few men know how to acquire wealth and therefore monopolise it, while the mass of our citizens lack the knowledge of how to keep any part of the gold they receive.”

“Tell me Arkad,” continues the King, “Is there any secret to acquiring wealth? Can it be taught?”

“It is practical, your majesty.”, replied Arkad, “That which one [person] knows can be taught to others.”

By dedicating yourself to the pursuit of knowledge in your desires to become wealthy, you must find teachers in experts in their field to learn from. Once you can demonstrate to yourself, objectively, that you are seeing the seeds you have been planting sprout, it is your duty to share that knowledge with others. “Part of my joy in learning” to quote Seneca again, “is that it puts me in a position to teach.”

Finally, remember that there is strength in asking for help — especially on something that affects each and every one of us like ‘how does money work?’. I’ll leave you with a beautiful line from Charlie Mackesy’s The Boy, the Mole, the Fox and the Horse:

Asking for help isn’t giving up. Said the Horse,

It’s refusing to give up.