What Arnold Schwarzenegger and Gene Fama Have in Common
One of the better things about getting older is that you get to look back on the people who’ve shaped your life. For me, two people keep coming to mind, and I’ll admit seeing their names next to one another makes me chuckle: Arnold Schwarzenegger and Gene Fama. Between the three of us, we have a dozen bodybuilding championships and a Nobel Prize in Economic Sciences.
They couldn’t look more different. One spent his early years in weight rooms in Austria and Germany, the other as part of a working-class family in Massachusetts. One became the most famous action movie star in the world and then governor of California. The other became the most cited financial economist in history. And the more time I’ve spent with both of them, the more I notice the characteristics they share.
They both arrived somewhere new, looked at how things were being done, and figured it could work better. Gene walked into academic finance when the prevailing assumption was that smart people could beat the stock market. He looked at the data and concluded that was mostly a story the industry was telling itself. Arnold got to Hollywood and was told he didn’t fit in. Wrong accent, wrong name. He ignored that.
Gene came to the University of Chicago when historical financial data was first becoming available to study. I was fortunate to be one of his students. When we met, he was about 30 years old, a coiled spring of physical and intellectual intensity. And what he did with that data changed the way the world thinks about markets and investing. In teaching me finance, Gene taught me how to think. His insistence on evidence, his willingness to follow the data wherever it led—even when it made powerful people uncomfortable—that became the foundation of so much that I’ve tried to build.
Arnold arrived in America at a moment when bodybuilding was about to cross over into the mainstream. He didn’t create that wave, but he rode it longer and farther than anyone else. Then Hollywood, then politics. The insiders kept telling him he didn’t belong. He kept showing up until they changed their minds.
Gene and Arnold have spent their careers advocating for ideas bigger than themselves. For Gene, it was the truth about how markets actually work and what those findings could mean for ordinary investors. For Arnold, it was helping people see that their visions for a better future, for themselves, their families, the world, could be made real with goal setting, planning, and hard work.
Gene’s research has been cited hundreds of thousands of times and has quietly reshaped how millions of people invest. He trained a generation of researchers who went on to do their own serious work. Arnold now reaches millions through public appearances and his great newsletter. Reading his thoughts on fitness and resilience, I often find myself thinking: This sounds a lot like my investment philosophy, but with push-ups.
People often assumed Arnold’s secret was discipline, that he just had more willpower than the rest of us. He says that’s not it. Journalists would come to the gym, notice he was the only one smiling through the pain, and ask him why. His answer was simple: He had a vision for himself, one he knew was possible. Every rep brought him a step closer. The 500 sit-ups his training partners dreaded were something he looked forward to. That’s not discipline. That’s conviction.
Gene was the same way. All those years of careful, unglamorous work, following the data even when it made Wall Street insiders unhappy, didn’t seem like a grind to him. I know he was having a good time. I witnessed it every day as his research and teaching assistant. When you believe in an idea down to your tippy toes, you want to do whatever you can to help others share your enthusiasm for it.
Gene and Arnold could be on a beach somewhere, but they’re not. Gene is still looking for whatever the data might tell him next. Arnold is still trying to help more people believe in a better future and draw a map for getting there. After all these years, they continue to be an inspiration to me, and I hope they can be for you too.
Stay calm, stay invested, and let markets work for you.
David