Showing posts with label Lessons. Show all posts
Showing posts with label Lessons. Show all posts
Friday, January 1, 2010
Friday, October 24, 2008
Randy Parker Hall of Fame: Ralph.
This is Ralph. He never told me his last name. It is not really HIM but he looked just like this guy, hat and all. Ralph lived in Lexington, Kentucky when I was in graduate school. He would hang out on the street corner and wait for me to walk to school on Wednesdays. He would stop me and chat for 5 minutes or so and then send me on my way. We always used to meet at the race track betting the ponies and he would bum bus fare from me to get back to town when he went "tap city" for the day. Ralph taught me one of the greatest lessons of life. One day he just came out and said "Listen here, if you ain't humble, then you better get humble, because one way or another life is gonna make you humble."
Read that again, and file it under words to live by. I don't know that there is a person in the Randy Parker Hall of Fame with a higher ranking than Ralph. When I was around him he was about 75 in 1984. I am sure he is no longer with us. But I will never forget him and what he taught me. Thanks Ralph and say hi to Jackie Robinson for me.
Sunday, October 12, 2008
Monday October 13 Reality Check Part III: Lessons from Home.
The world is falling down around your ears and you are wondering what will happen next. Well me too. Just remember one thing. You are who you are today because of certain fundamental principles you have followed through time. They are what have made you what you are and they need to be remembered and repeated in times like these.
I am just back from my 30th high school reunion. I did not go to the 10th or 20th, so this was a real treat. Some things were a shock to behold...like the guys who have done way too many drugs and had their eye balls spinning in their heads while they talked to you. But others told me inspiring stories of prevailing in the face of great adversity...children with special needs, spells of severe illness, deceased spouses and carrying on with two kids and not knowing what will happen in the future. Fancy elixirs and potions or magic spells did not get them through to the other side. They stuck to what they knew would work.
As you go forward, let me ask you to ask yourself what it is that defines who you are. Find that out and then stick to it. Because that is what is going to get this economy to the other side too. People rationalized and justified the legitimacy of the tech bubble during the 1990s with the mantra "All the old rules have changed! The old fundamentals don't apply any more!" I don't have to tell you about the internet bubble eh? Folks told me on visits to Florida in the recent past that they could foresee their real estate values sustain 20% per year increases indefinitely because this was a new and different market. Arthur Burns, Chair of the Fed back in the 1970s said the same thing during the recession of 1973-75 "the old rules don't apply anymore." They said the same thing in Japan in the 1980s and in the US during the 1920s hey days. It is a lie that you have to rise above.
Patton was quoted as saying "although I have fought under many guises, many names...in the end...always me."
And me...and you too.
I am just back from my 30th high school reunion. I did not go to the 10th or 20th, so this was a real treat. Some things were a shock to behold...like the guys who have done way too many drugs and had their eye balls spinning in their heads while they talked to you. But others told me inspiring stories of prevailing in the face of great adversity...children with special needs, spells of severe illness, deceased spouses and carrying on with two kids and not knowing what will happen in the future. Fancy elixirs and potions or magic spells did not get them through to the other side. They stuck to what they knew would work.
As you go forward, let me ask you to ask yourself what it is that defines who you are. Find that out and then stick to it. Because that is what is going to get this economy to the other side too. People rationalized and justified the legitimacy of the tech bubble during the 1990s with the mantra "All the old rules have changed! The old fundamentals don't apply any more!" I don't have to tell you about the internet bubble eh? Folks told me on visits to Florida in the recent past that they could foresee their real estate values sustain 20% per year increases indefinitely because this was a new and different market. Arthur Burns, Chair of the Fed back in the 1970s said the same thing during the recession of 1973-75 "the old rules don't apply anymore." They said the same thing in Japan in the 1980s and in the US during the 1920s hey days. It is a lie that you have to rise above.
Patton was quoted as saying "although I have fought under many guises, many names...in the end...always me."
And me...and you too.
Friday, October 10, 2008
Sunday OCTOBER 12 Reality Check Part II: Lessons from Horse Race Gambling
Good Morning. We go back to work tomorrow. So let's review one more time...
Horse race gambling rule #4: Scared money don't win.
When next week roles around there are going to be some great values around. Look me in the eyes and tell me this is not a full-blown financial panic like you read about in the history books. It is. The sell off has little to do with fundamental analysis and everythig to do with panic. Bank of America at $19? Sign me up. JP Morgan led by Jamie Dimon at $38? Order here! Petroleum stocks clobbered...I'll have some of those too. And I will buy with confidence because I have done my handicapping for myself (horse race gambling rule #1) and I am confident in my analysis. I don't buy equities with scared money.
And neither should you. If you don't have the guts to ride out market volatility then you should not have been here in the first place. And if you want to get back in but are going to worry about it, then you are playing with scared money and are going to lose.
But for those of you out there who want to make some plays and cash, now is looking like the time. If the market tanks to 5000 then who cares anyway.
Horse race gambling rule #4: Scared money don't win.
When next week roles around there are going to be some great values around. Look me in the eyes and tell me this is not a full-blown financial panic like you read about in the history books. It is. The sell off has little to do with fundamental analysis and everythig to do with panic. Bank of America at $19? Sign me up. JP Morgan led by Jamie Dimon at $38? Order here! Petroleum stocks clobbered...I'll have some of those too. And I will buy with confidence because I have done my handicapping for myself (horse race gambling rule #1) and I am confident in my analysis. I don't buy equities with scared money.
And neither should you. If you don't have the guts to ride out market volatility then you should not have been here in the first place. And if you want to get back in but are going to worry about it, then you are playing with scared money and are going to lose.
But for those of you out there who want to make some plays and cash, now is looking like the time. If the market tanks to 5000 then who cares anyway.
Wednesday, October 8, 2008
Sunday OCTOBER 12th...Reality Check Part I: Lessons from Horse Race Gambling
Good morning. Rules become rules for a reason. It never hurtsw to go over and over them. So, we go back to work tomorrow and need to remember.....
Many of you have been clammoring for me to tell you all the rules of horse race gambling since I spilled #3: If you can't take the losses, don't bet.
Well now the good doctor is going to tell you the most important one by far. I can't leak them out all at once. They cost too much to learn myself. But here it is:
Horse race gambling rule #1: Do your handicapping for yourself.
That is, study the horses racing the day you are going to the track and trust your own analysis and choice making abilities. Don't rely on what you heard somebody say or the dreaded "common tout" who calls you over and says, "hey buddy, this horse is a sure winner, you got to get on it." Or they will say "your horse ain't got a chance in the world!" So you change your mind and the horse you got talked off of wins and pays $26.50. That is the surest way to be parted from your cash. Some stumble bum, broken down old horse player with a five-day beard, six teeth, and a hunch is going to determine your picks? No no! Don't fall for it.
So let me ask...how many of you are making your current investment decisions based on what you just heard on CNBC, or what Jim Cramer just said? "Ah ha! That is the piece of info I have been looking for! Sell, Sell, Sell!" Please understand I am not in the investment advice business with this blog. I am just asking you for some self-reflection. If this is how you are deciding to move your money, without any careful thoughts of your own, without doing your handicapping for yourself, then you are no better than some fool at the race track that bets the farm on the ranting of some stew bum common tout. Because that is what those talking heads on TV are. There is no difference here. And that is how you are managing your money. Like a fool.
I don't want to be too hard on anyone. But go through the above reality check to see if you fit. If you do, you are playing a very dangerous game that you are going to lose.
And if you see that broken down old horse player with a five-day old beard and six teeth at the track...tell my brother I said hi.
Many of you have been clammoring for me to tell you all the rules of horse race gambling since I spilled #3: If you can't take the losses, don't bet.
Well now the good doctor is going to tell you the most important one by far. I can't leak them out all at once. They cost too much to learn myself. But here it is:
Horse race gambling rule #1: Do your handicapping for yourself.
That is, study the horses racing the day you are going to the track and trust your own analysis and choice making abilities. Don't rely on what you heard somebody say or the dreaded "common tout" who calls you over and says, "hey buddy, this horse is a sure winner, you got to get on it." Or they will say "your horse ain't got a chance in the world!" So you change your mind and the horse you got talked off of wins and pays $26.50. That is the surest way to be parted from your cash. Some stumble bum, broken down old horse player with a five-day beard, six teeth, and a hunch is going to determine your picks? No no! Don't fall for it.
So let me ask...how many of you are making your current investment decisions based on what you just heard on CNBC, or what Jim Cramer just said? "Ah ha! That is the piece of info I have been looking for! Sell, Sell, Sell!" Please understand I am not in the investment advice business with this blog. I am just asking you for some self-reflection. If this is how you are deciding to move your money, without any careful thoughts of your own, without doing your handicapping for yourself, then you are no better than some fool at the race track that bets the farm on the ranting of some stew bum common tout. Because that is what those talking heads on TV are. There is no difference here. And that is how you are managing your money. Like a fool.
I don't want to be too hard on anyone. But go through the above reality check to see if you fit. If you do, you are playing a very dangerous game that you are going to lose.
And if you see that broken down old horse player with a five-day old beard and six teeth at the track...tell my brother I said hi.
Monday, October 6, 2008
When all else fails, read the instructions.
Competitive capitalism is going to take some lumps and bumps in the near and far future as a result of what I call the "double bubble" that has hit us from 2000-now. OK, it is well and good that this type of self-evaluation takes place. But when it is all said and done, please remember that the only way that you and your family and that of your ancestors have escaped the grinding poverty that characterizes most of the world's population is through the evolution of free markets here in the U.S. and throughout our economic history. If you take the income level of what we define today as poverty ($10,400 for an individual in 2008), 13% or so of our population are classified as poor. If you take that same income level and put it into equivalent purchasing power dollars in the year 1900, the turn of the last century, guess what percentage of the U.S. population in the year 1900 was below what we consider poverty today? The answer: 90%. And that is a solid economic fact from Nobel Laureate Robert Fogel.
Remember this as competitive capitalism gets hammered and takes a whipping. Don't forget the bigger picture. Oh yes, and remember too that the World Bank definition of poverty is $2.00 a day.
And one more thing, when the conversation turns to greed, listen to the Master here: http://www.youtube.com/watch?v=RWsx1X8PV_A
Milton Friedman is in the Randy Parker Hall of Fame too, but I'll speak more of him later...and for the rest of my life.
Remember this as competitive capitalism gets hammered and takes a whipping. Don't forget the bigger picture. Oh yes, and remember too that the World Bank definition of poverty is $2.00 a day.
And one more thing, when the conversation turns to greed, listen to the Master here: http://www.youtube.com/watch?v=RWsx1X8PV_A
Milton Friedman is in the Randy Parker Hall of Fame too, but I'll speak more of him later...and for the rest of my life.
Saturday, October 4, 2008
Remember...we are still in a recession.
I am willing to go all in and believe 100% we are in a recession. It is not the case that the bailout is going to make everything right with the stroke of a pen. No No. It is going to stop things from flying apart and that is very important to recognize. But the economy remains mired in some pretty nasty muck and jobs keep disappearing. Sorry to say it, but it is true.
Some ask why the market fell after the bail out passed. I dunno, maybe you can tell me. Trying to explain the day-to-day, no wait, hour-to-hour variation in the market is a fools' game. You want to try it...go ahead. I'll come visit you at the local mental health institution for the psychologically challenged and differently abled because that is where you are headed. This is a bash-free blog so that is why I will not call it "the nut house".
Like my dad said to me 6 months before he passed away, "Son, I'm so old, I don't go past the cemetary because I am afraid guys with shovels will start chasing me." Go trying to figure hour-to-hour market moves and the boys with the white coats and straight jackets ain't far behind.
Some ask why the market fell after the bail out passed. I dunno, maybe you can tell me. Trying to explain the day-to-day, no wait, hour-to-hour variation in the market is a fools' game. You want to try it...go ahead. I'll come visit you at the local mental health institution for the psychologically challenged and differently abled because that is where you are headed. This is a bash-free blog so that is why I will not call it "the nut house".
Like my dad said to me 6 months before he passed away, "Son, I'm so old, I don't go past the cemetary because I am afraid guys with shovels will start chasing me." Go trying to figure hour-to-hour market moves and the boys with the white coats and straight jackets ain't far behind.
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