![]() RANDOM THINGS MAGIC BEAN PROFESSIONALWith these we can own the entire market and outperform over time all but the rarest of professional money managers. Analyzing and choosing individual stocks was the only option.īut now, thank you Jack Bogle, we have index funds. ![]() But remember, when Graham wrote it, Index Funds would not be invented for several more decades and mutual funds were few and far between. It is a great book and by all means take the time to read it. Read it, and then get to work combing the Aristocrats for bargains.” “For a great primer on valuing stocks, check out the Intelligent Investor, by Warren Buffett’s mentor, Benjamin Graham. What is poisonous in The Dividend Aristocrats post is this: In fact here’s a bet that will likely make you more money: Within 5 years you’ll be reading about how Growth Stocks are the sure path to prosperity and Value (dividend) stocks are for losers who can’t do the simple home work of analyzing the good stocks. You’ll just lag behind the market over the next decade. So no Magic Beans in The Dividend Aristocrats, but they likely won’t be as poisonous as some of the other Beans. No better sign than the end is near for them. Mmmm, with all this new popularity I should be taking my chips off the table soon. Its a good one.Īs I mentioned at the end of that post, I actually made some money last year riding the Div-Stock wave. ![]() Now? Now it seems everywhere I turn the new flavor of Bean is Dividend Investing or, even more impressively, The Dividend Aristocrats. Or, well, $1566 as of year end and falling. Yikes.Ī few weeks back it was pushing $2000 an ounce on its way to $5000. There was even one place that offered to sell it to you and then, for a fee, store it for you as well. It is, after all, the one true store of value through human history. How could I not? Every time I turned on the TV, opened the paper or listened to the radio people were spending huge sums of advertising money to tell me I, too, could get rich buying (preferably from them) Gold. Saved me a bundle in avoiding this latest debacle. RANDOM THINGS MAGIC BEAN HOW TOI’m sure glad I learned how to lose money in real estate back in the 80s and before it was fashionable. You could cash out profits and still live in the place. Why banks, and how could they ever be wrong, would even loan you money on all your equity. See people will always need a place to live, right? Seemed to make sense at the time. ![]() Strike a nerve? Yep, stocks and bonds went up and down but houses? Houses could only go up. ![]() The investment world is littered with the remains of once super-star fund managers.* You couldn’t go to a party without some guy telling you about his latest killing. You want growth! Find companies with “forward thinking” (what a wonderful phrase!) leaders skilled in deploying capital. Value Stocks that paid dividends? Clearly run by managements with no vision, so lacking in ability that they could think of nothing better to do with profits than to pay them out. Why, any management worth its salt should be able to plow profits back into the business and reach even greater heights. I remember Growth Stocks were all the rage awhile back. What they all have in common is that by the time you start reading about them everywhere, the end is near. Being a geezer I’ve been around long enough to see quite a few flavors come and go. For supposedly rational creatures we humans seem irrationally drawn to Magic Beans. ![]()
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