I Don't Know

Headshot of Trent Klarenbach, founder of Klarenbach Research
Trent Klarenbach
April 11, 2024
Three letters that say I D K
April 11, 2024

We live in a world of binary thinking.

Where there are two sides, and you can only pick one.

Are you with me or against me?

We attach labels with certainty.

Black. White.

Capitalist. Socialist.

Left. Right.

Conservative. Socialist.

Bullish. Bearish.

When I was younger, my conviction was stronger.

About most things. Maybe everything.

There were rights, and there were wrongs.

I was adept at supporting my biases.

My conviction about most topics has changed over time.

A developing awareness that I live in a dynamic world with a constant stream of new information to process reduces my conviction. 

Things change. 

My opinion will change.

Asking the questions, “What don’t I know?” and “What are the weaknesses in my thesis?” is powerful.

I no longer get married to my beliefs.

The older I get, the less I know.

As William Goldman wrote about the motion picture industry:

“Nobody knows anything...... Not one person in the entire motion picture field knows for a certainty what's going to work. Every time out, it's a guess and, if you're lucky, an educated one.”

We can apply the same thesis to grain marketing.

Growers and buyers with Long positions tend to believe the prices are increasing.

Short position holders tend to believe that the price will move lower.

Sometimes, the market is trending up or down, increasing our conviction that that trend continues.

Other times, the market moves sideways, displaying the trend's uncertainty as the buyers and sellers battle for control.

Humans crave certainty.

We seek out binary answers.

Is the price going up?

Is the price going down?

The battle between the buyers and sellers is often not providing a high-probability, low-risk answer.

The accompanying price chart is an example of this.

I need the price to get above 51 to become Bullish.

A new low below 45 makes me Bearish.

Between 45 and 51?

I Don’t Know.

Saying I Don’t Know is a strength, not a weakness.

It is a superpower.

Weekly chart with I don't know parameters