“How long is long term?” Swami asked while sipping his coffee. Before Jigneshbhai and I wondered what he was referring to, he answered it. “I mean I have been training in the gym for a full two months now,” he said.
“And Sam now tells me to check for results after minimum six months, maybe a year. I think he wants to sell me annual membership,” Swami remarked while munching into his muffin.
I felt like telling him that as long as he continues munching into two muffins every time we meet, even six months may not be long-term enough. But I stayed silent unlike Swami.
For Jigneshbhai, the theory of how long was long-term in the arena of physical fitness was clear, though he didn’t venture into that area at a practical level.
“Maybe three years?” he ventured a guess.
“Three years??” Swami almost jumped on his seat. “You are worse than Sam,” he said.
“I am just guessing,” Jigneshbhai confessed. “Else everyone would get fit in six months.”
He might have been right. Six months is a period for which anyone, well not anyone but someone motivated enough, can force oneself to go to the gym if results are guaranteed.
But beyond that threshold of six months, the dropouts start is what Sam had told us once. “Generally three months is easy, six months needs some discipline, but beyond that the motivation drops for most,” he had told us. So Jigneshbhai might be right, theoretically. Though again I didn’t say anything.
“Three years is too long. For investing, you said long-term is at least seven years. Even that I thought was too long. Why does everything take so long?” Swami asked.
“Most people overestimate what they can do in one year and underestimate what they can do in ten years.” Jigneshbhai read out from his phone, as if to reassure Swami.
Swami and I were all ears. “Someone great has said it, not me,” he clarified in a hurry.
“This old cafe is an example, isn’t it?” he asked. “How old is it now? Twenty years? Who would have thought it would still be around when we first started meeting here?” he probed.
Swami and I munched into our muffin and, sort of, agreed. Even the muffin seemed to have undergone dramatic improvements over the long period that we have been having it. My mind went back to the small cake we used to have a few years back. But Swami was well and truly in the present and wasn’t convinced that the long-term mattered a lot.
“True. But that era of long-term is behind us. Now everyone wants everything immediately. Quick returns, quick weight loss, quick everything,” Swami said.
I seemed to agree even with Swami.
The fact that I agreed with Swami too wasn’t a surprise. That had been my problem over the years. I sometimes agreed with Jigneshbhai, sometimes with Swami, often with both. This was another one of those agreeable times.
Most of us today are short-term oriented, I felt. Though Jigneshbhai wasn’t wrong, Swami was right, I told myself.
Whatever we may be into, we have truly little ability to think and act beyond the short term. Most investors want returns in the short term. Most gym goers want to reduce weight quickly.
Swami continued on his track while I mused.
“If I told Raichand, let us think long-term, he will tell me to go find a job elsewhere. And elsewhere wouldn’t be too different, I am certain. Most companies want their employees to perform in this quarter, or this year, if they are patient,” Swami reiterated.
Jigneshbhai stayed silent for a while, sipping coffee slowly.
“That’s true. There’s lot of competition for results in the short-term,” he said. Well, that was a surprise to me. Jigneshbhai agreeing so soon with Swami didn’t happen every day.
“Forget companies, even parents want children to score marks in this year’s exam,” Swami kept coming up with more evidence of competition for short-term results.
Jigneshbhai nodded. “That’s right. That’s the reality. The long-term is relatively deserted,” he said.
With Jigneshbhai nodding in agreement with Swami, this was turning out to be a one-sided argument, I thought to myself.
“Well, in the long-term, we are all dead, someone great said that too right?” Swami got excited. Jigneshbhai nodded again.
Rarely had Jigneshbhai agreed so much with Swami over something. But I wasn’t sure if Jigneshbhai was actually in agreement or just stating reality. For few moments, Swami and I sipped our coffee in silence. I got a sense that something was cooking. It turned out that he hadn’t got started yet. I understood that well when he spoke next.
“Ask any investor if he can stay invested for 20 years and you will get blank looks. Ask any gym goer if he can sign up for a 10-year membership and you will be seen as a conman,” he said while munching his muffin.
“Ask any parent to enrol their child for a course that their child is interested in but will have no output for 10 years and you will have no enrolment. Ask any company to hire employees who intend to leave only on retirement, and you will get laughter.”
Swami and I heard Jigneshbhai and realised that he didn’t like the short-term mentality. But he wasn’t naive to realise that the world didn’t agree with him. The examples he gave were really long-term, in fact, so long-term that they were beyond long-term for most people.
It was true that ten-year gym memberships and twenty-year investment horizons would get not just laughter and mockery, but even weird looks questioning your mental balance or even integrity from most people. But still, it didn’t escape my mind that the genuinely great results were only achievable over those time horizons. But the sad reality was that it was a time horizon over which, let alone getting results, nobody even played.
While Swami and I pondered over what Jigneshbhai had said, I saw the wealthy old man walk towards our table.
He put a hand on Swami’s shoulder and said, “If you have the ability and the luxury of thinking and acting really long-term, that is a strong competitive advantage.”
That was the longest sentence we had heard from the wealthy old man in a long time.
It was clear which time horizon he was in favour of.
He then added, “The long-term is a place of no competition.”
***