First-level thinking says “it’s a good company; let’s buy the stock.” Second-level thinking says, “It’s a good company, but everyone thinks it’s a great company, and it’s not. So the stock’s overrated and overpriced; let’s sell.”
First-level thinking says, “The outlook calls for low growth and rising inflation. Let’s dump our stocks.” Second-level thinking says, “The out-look stinks, but everyone else is selling in a panic. Buy!”
Of course, the classic recent example of a win for second level thinkers was the March low in stocks, followed by a massive snap back. First level thinking resulted in selling into the dip and second level in buying.
Second level thinking is hard, but also well worth it, because even if we only manage to do a little—I struggle all the time—we can still profit.
Anyway, enough with investing, let's look at applying second level thinking to offshore voyaging: