Take Your Best Shot
Synopsis: A violent duel on the plains of Weehawken, New Jersey shocked the world in the 19th century and then captivated Broadway two hundred years later. What can investors learn from the death of Alexander Hamilton?
“One!” In the early morning of July 11th, 1804, a hot and humid breeze wafted intermittently off the Hudson and perspiration ran in rivulets as two men strode away from each other and toward infamy.
“Two!” Early morning light slanted through the trees and the cliffs of the Hudson River Palisades loomed silently overhead. The dueling ground near Weehawken, New Jersey was also ominously quiet, save for the gentle lap of the river, the bobbing of canoes and the ominous counting of steps.
“One moment. I need to adjust my spectacles.” The combatant wearing glasses tugged them into position, then looked though his pistol’s sights to check his aim. The countdown resumed. When it was complete, the men faced each other at a distance of ten paces. They assumed the fighting position, pistol muzzle down and eyed each other coolly, though the day had become stifling.
From across the river came the metropolitan sounds of sixty-thousand inhabitants of New York City coming to life. The duelists needed to be done with this to avoid any uncomfortable questions or complications. Dueling was illegal in New York and New Jersey.
The man in glasses raised his pistol for the first time since the Revolutionary War. The discharge shattered the calm of the morning and he smelled the acrid smoke as the ball left the smooth bore barrel. He’d aimed high and wide, wishing to maintain his honor without killing the other duelist. It was common practice to thus prove one’s courage and conclude the proceedings without injury. Alexander Hamilton, hero of the Revolution and first Secretary of the Treasury, was satisfied.
His opponent was not. Aaron Burr, sitting Vice President of the United States heard the ball whine past his head. His pistol came up and the second discharge echoed off the cliffs above. This one did not miss. Hamilton grunted as the shot entered above his right hip, the ball careening into his lower rib cage and sending bone fragments into his liver and diaphragm. Hamilton collapsed and died thirty-six agonizing hours later. Burr was led quickly away toward the waiting canoes and would soon be charged with murder, though he finished his term as Vice President immune from prosecution.
Thus ended a long and bitter political rivalry between two men who had once practiced law together, but whose relationship soured during the bitter presidential politics of the post-Revolution period. Today, it is best known as the penultimate scene in the hip-hop Broadway musical Hamilton.
Here are three steps to follow for investors doing their best to keep out of harm’s way:
“One!” Learn from others’ mistakes. Hamilton’s own son was killed on the exact same dueling ground just three years prior. There were plenty of ways for dear old Dad to maintain his honor without a shot being fired, but he continued to press his luck until it ran out. Today, there exists plenty of research detailing the missteps investors agonize most over. But most don’t heed the warnings and avoid any advice at all, even from straight shooters.
“Two!” Understand it isn’t just about you. It sure was nice of Hamilton to avoid taking a killing shot at Burr. Too bad Burr didn’t have the same thing in mind. Similarly, investing in capital markets is a showdown with millions of others whose strategy and tactics may be very different from yours. Make sure your own approach is based on research and fact, not just gut feelings. In other words, make sure your plans aren’t half-cocked.
“Three!” Put politics in its place. Loving or hating the government, or anyone in it, isn’t an investment strategy. Investors have done just fine with various parties in power since men like Hamilton and Burr created them. Their confrontation shows that our current political situation isn’t the worst division in our history, no matter what the cable news channels say. For smart investors, it is just the same old song and dance.
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