{"id":33368,"date":"2025-06-12T23:56:00","date_gmt":"2025-06-12T15:56:00","guid":{"rendered":"https:\/\/www.granitefirm.com\/blog\/us\/?p=33368"},"modified":"2025-11-29T13:09:17","modified_gmt":"2025-11-29T05:09:17","slug":"ignorance","status":"publish","type":"post","link":"https:\/\/www.granitefirm.com\/blog\/us\/2025\/06\/12\/ignorance\/","title":{"rendered":"Ignorance is the commonality of  mediocre investors"},"content":{"rendered":"\n<p>Ignorance is defined as a lack of knowledge. You can be an smart person but be ignorant in certain areas. About forecast, John Maynard Keynes said \u201cWe simply don\u2019t know.\u201d<\/p>\n\n\n\n<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_82_2 counter-hierarchy ez-toc-counter ez-toc-custom ez-toc-container-direction\">\n<div class=\"ez-toc-title-container\">\n<p class=\"ez-toc-title\" style=\"cursor:inherit\">Table of Contents<\/p>\n<span class=\"ez-toc-title-toggle\"><a href=\"#\" class=\"ez-toc-pull-right ez-toc-btn ez-toc-btn-xs ez-toc-btn-default ez-toc-toggle\" aria-label=\"Toggle Table of Content\"><span class=\"ez-toc-js-icon-con\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #ffffff;color:#ffffff\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #ffffff;color:#ffffff\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/span><\/a><\/span><\/div>\n<nav><ul class='ez-toc-list ez-toc-list-level-1 ' ><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/www.granitefirm.com\/blog\/us\/2025\/06\/12\/ignorance\/#There_are_three_kinds_of_ignorance\" >There are three kinds of ignorance<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/www.granitefirm.com\/blog\/us\/2025\/06\/12\/ignorance\/#Rumsfeld_matrix\" >Rumsfeld matrix<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-3\" href=\"https:\/\/www.granitefirm.com\/blog\/us\/2025\/06\/12\/ignorance\/#Ignorance_breeds_fear\" >Ignorance breeds fear<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-4\" href=\"https:\/\/www.granitefirm.com\/blog\/us\/2025\/06\/12\/ignorance\/#Self-knowledge_is_the_most_important\" >Self-knowledge is the most important<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-5\" href=\"https:\/\/www.granitefirm.com\/blog\/us\/2025\/06\/12\/ignorance\/#People_waste_energy_on_pointless_things\" >People waste energy on pointless things<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-6\" href=\"https:\/\/www.granitefirm.com\/blog\/us\/2025\/06\/12\/ignorance\/#Closing_words\" >Closing words<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-7\" href=\"https:\/\/www.granitefirm.com\/blog\/us\/2025\/06\/12\/ignorance\/#Related_articles\" >Related articles<\/a><\/li><\/ul><\/nav><\/div>\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"There_are_three_kinds_of_ignorance\"><\/span>There are three kinds of ignorance<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>Ignorance can be divided into three types:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Self-knowledge Ignorance is when one knows that he or she does not know.<\/li>\n\n\n\n<li>Meta-Ignorance is not knowing that you don\u2019t know.<\/li>\n\n\n\n<li>Paranoid Ignorance is the belief that one knows something that one does not know, and most of these views are wrong.<\/li>\n<\/ul>\n\n\n\n<p>Harvard economist John Kenneth Galbraith once said, \u201cThere are only two kinds of people who try to predict the future: those who know nothing, and those who don\u2019t know they know nothing.\u201d &#8220;People!&#8221; This sentence really hits the nail on the head.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Rumsfeld_matrix\"><\/span>Rumsfeld matrix<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p><a href=\"https:\/\/web.archive.org\/web\/20160406235718\/http:\/\/archive.defense.gov\/Transcripts\/Transcript.aspx?TranscriptID=2636\" target=\"_blank\" rel=\"noopener\">&#8220;<strong>There are unknown unknowns<\/strong>&#8221; is a phrase from a response&nbsp;United States Secretary of Defense&nbsp;Donald Rumsfeld&nbsp;gave to a question at a&nbsp;U.S. Department of Defense&nbsp;(DoD) news briefing on February 12, 2002, about the lack of evidence linking the government of&nbsp;Iraq&nbsp;with the supply of&nbsp;weapons of mass destruction&nbsp;to terrorist groups<\/a>.&nbsp;Rumsfeld stated:<\/p>\n\n\n\n<blockquote class=\"wp-block-quote is-layout-flow wp-block-quote-is-layout-flow\">\n<p>Reports that say that something hasn&#8217;t happened are always interesting to me, because as we know, there are known knowns; there are things we know we know. We also know there are known unknowns; that is to say we know there are some things we do not know. But there are also unknown unknowns\u2014the ones we don&#8217;t know we don&#8217;t know. And if one looks throughout the history of our country and other free countries, it is the latter category that tends to be the difficult ones.<\/p>\n<\/blockquote>\n\n\n\n<p>The statement became the subject of much commentary. In&nbsp;<em>The Decision Book<\/em>&nbsp;(2013), author&nbsp;Mikael Krogerus&nbsp;refers to it as the &#8220;Rumsfeld matrix&#8221;. The statement also features in a 2013 documentary film,&nbsp;<em>The Unknown Known<\/em>, directed by&nbsp;Errol Morris.<\/p>\n\n\n\n<p>Known unknowns refers to &#8220;risks you are aware of, such as canceled flights&#8221;,whereas unknown unknowns are risks that come from situations that are so unexpected that they would not be considered.<br><\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Ignorance_breeds_fear\"><\/span>Ignorance breeds fear<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>Albert Camus wrote in his novel &#8220;<a href=\"https:\/\/www.amazon.com\/Plague-Albert-Camus\/dp\/0679720219\" target=\"_blank\" rel=\"noopener\">The Plague<\/a>&#8220;:&#8221;The evil in the world comes almost always from ignorance, and goodwill can cause as much damage as ill-will if it is not enlightened.&#8221;<\/p>\n\n\n\n<p>Paul-Henri Thiry, French philosopher, once said &#8220;<a href=\"https:\/\/academic.oup.com\/princeton-scholarship-online\/book\/15980\/chapter-abstract\/170922140?redirectedFrom=fulltext&amp;login=false\" target=\"_blank\" rel=\"noopener\">Man&nbsp;is&nbsp;superstitious only because he&nbsp;is&nbsp;afraid&nbsp;(craintif); he fears&nbsp;(craint)&nbsp;only because he&nbsp;is ignorant<\/a>&#8220;<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Self-knowledge_is_the_most_important\"><\/span>Self-knowledge is the most important<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>Socrates famously said: \u201cThe only true wisdom is in knowing you know nothing\u201d, he also said: &#8220;<a href=\"https:\/\/en.wikipedia.org\/wiki\/I_know_that_I_know_nothing\" target=\"_blank\" rel=\"noopener\">I know that I know nothing.<\/a>&#8220;<\/p>\n\n\n\n<p>Bertrand Russell once said \u201cThe whole problem with the world is that fools and fanatics are always so certain of themselves, and wiser people so full of doubts.\u201d<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"People_waste_energy_on_pointless_things\"><\/span>People waste energy on pointless things<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>People squander a great deal of time and energy on guessing about known unknowns. Brexit, emerging markets, commodities, interest rates, oil prices, quantitative easing, and the US presidential election are all known unknowns.<\/p>\n\n\n\n<p>The problem isn&#8217;t just that these events are difficult or even impossible to predict. Markets are so-called &#8220;second-order&#8221; systems: to invest successfully on this basis, you must not only predict the outcome of events, but also know the market&#8217;s expectations and how the market will react. <\/p>\n\n\n\n<p>Then there&#8217;s the problem of &#8220;unknown unknowns.&#8221; Events that can cause significant market shifts may be events that no one has even noticed. If you don&#8217;t even know an event exists, you&#8217;ll find it very difficult to predict its outcome.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Closing_words\"><\/span>Closing words<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>John Kenneth Galbraith said, &#8220;There are two kinds of forecasters: those who are ignorant, and those who do not know they are ignorant.&#8221;<\/p>\n\n\n\n<p>In <em>Plato&#8217;s Apology<\/em> (sections 21d\u201323c), Socrates describes how the Oracle at Delphi proclaimed that no one was wiser than Socrates. Socrates, puzzled by this, went around questioning people who were reputed to be wise. He concluded:<\/p>\n\n\n\n<blockquote class=\"wp-block-quote is-layout-flow wp-block-quote-is-layout-flow\">\n<p>\u201cI am better off than he is\u2014for he knows nothing, and thinks that he knows. I neither know nor think that I know.\u201d<\/p>\n<\/blockquote>\n\n\n\n<p>Recognizing your own ignorance is the only true wisdom.<\/p>\n\n\n\n<p>&nbsp;&#8220;The degree of a person&#8217;s emotions is inversely proportional to the amount of facts he knows; the less you know, the more out of control your emotions become,&#8221; Bertrand Russell said.<\/p>\n\n\n\n<figure class=\"wp-block-image size-full\"><img loading=\"lazy\" decoding=\"async\" width=\"156\" height=\"90\" src=\"https:\/\/www.granitefirm.com\/blog\/us\/wp-content\/uploads\/sites\/2\/2025\/01\/ignorance-Custom.jpg\" alt=\"Ignorance\" class=\"wp-image-33369\"\/><figcaption class=\"wp-element-caption\">credit: iStockPhoto<\/figcaption><\/figure>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Related_articles\"><\/span>Related articles<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<ul class=\"wp-block-list\">\n<li>&#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2025\/06\/12\/ignorance\/\">Ignorance is the commonality of mediocre investors<\/a>&#8220;<\/li>\n\n\n\n<li>&#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2021\/08\/31\/circle-of-competence\/\">The importance of circle of competence<\/a>&#8220;<\/li>\n\n\n\n<li>&#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2022\/11\/16\/important-and-knowable-info\/\" target=\"_blank\" rel=\"noreferrer noopener\">Information investors need should be important and knowable<\/a>&#8220;<\/li>\n\n\n\n<li>&#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2025\/06\/06\/seeking-facts\/\">Seeking facts is the first step in investment<\/a>&#8220;<\/li>\n\n\n\n<li>&#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2021\/11\/20\/investment-knowledge\/\">Investment knowledge required is breadth, not depth as most people think<\/a>&#8220;<\/li>\n<\/ul>\n\n\n\n<p><em><strong>Disclaimer<\/strong><\/em><\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li><em>The content of this site is the author\u2019s personal opinions and is for reference only. I am not responsible for the correctness, opinions, and immediacy of the content and information of the article. Readers must make their own judgments.<\/em><\/li>\n\n\n\n<li><em>I shall not be liable for any damages or other legal liabilities for the direct or indirect losses caused by the readers&#8217; direct or indirect reliance on and reference to the information on this site, or all the responsibilities arising therefrom, as a result of any investment behavior.<\/em><\/li>\n<\/ul>\n","protected":false},"excerpt":{"rendered":"<p>Socrates famously said: &#8220;The greatest wisdom is to know one&#8217;s own ignorance.&#8221; &#8220;The only thing I know is that I know nothing.&#8221;<\/p>\n","protected":false},"author":1,"featured_media":33369,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[392],"tags":[],"class_list":["post-33368","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-circle-of-competence"],"_links":{"self":[{"href":"https:\/\/www.granitefirm.com\/blog\/us\/wp-json\/wp\/v2\/posts\/33368","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.granitefirm.com\/blog\/us\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.granitefirm.com\/blog\/us\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.granitefirm.com\/blog\/us\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.granitefirm.com\/blog\/us\/wp-json\/wp\/v2\/comments?post=33368"}],"version-history":[{"count":29,"href":"https:\/\/www.granitefirm.com\/blog\/us\/wp-json\/wp\/v2\/posts\/33368\/revisions"}],"predecessor-version":[{"id":40173,"href":"https:\/\/www.granitefirm.com\/blog\/us\/wp-json\/wp\/v2\/posts\/33368\/revisions\/40173"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.granitefirm.com\/blog\/us\/wp-json\/wp\/v2\/media\/33369"}],"wp:attachment":[{"href":"https:\/\/www.granitefirm.com\/blog\/us\/wp-json\/wp\/v2\/media?parent=33368"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.granitefirm.com\/blog\/us\/wp-json\/wp\/v2\/categories?post=33368"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.granitefirm.com\/blog\/us\/wp-json\/wp\/v2\/tags?post=33368"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}