Daily Posts Archive
Today is Columbus Day, the day we honor the man with the courage to venture into the unknown, to do something different. As Americans, we all owe him a debt of gratitude. As investors, we should remember that it’s people like Columbus who have made America great, people who try something new, and create value from nothing. We need more men like him today.
Not all of our editors work at the Cabot offices in Salem, Massachusetts, but they drop in from time to time for us to discuss how things are going now and where we want them to be in the future. We were fortunate enough to have J. Royden Ward, who lives in Florida and is the editor of Cabot Benjamin Graham Value Letter, in the office this week recapping his recent trip to New York City to attend the Value Investing Congress.
I was lucky when I first began investing. I didn’t learn how to pick stocks from a textbook, or a well-meaning but misinformed professor. No, I first got interested in stocks when my dad subscribed to the Cabot Market Letter back in the mid-1990s, and learned right away the value of doing the right things, and avoiding the wrong things.
On the growth side there are stocks in promising technology sectors whose companies have posted triple-digit earnings growth for two or three quarters but are still falling down the stairs with no support in sight. The opportunities are huge. But here’s the big warning: Don’t Act Until the Market Actually Turns!
Today I’m not going to write about our country’s economic crisis; everyone else has done that. And I’m not going to reiterate my conviction that the worst of the bear market has passed, and that the future for many stocks will be very good from here. Savvy investors know that the best stocks will lead the way higher long before the man on the street loses his recently reinforced fear of investing.
Last week I wrote about the government’s $700 bailout plan and asked for your opinions. I got an incredible response, both by email and on the blog. I really appreciate hearing what you had to say and it helped me to sort out the whole mess in my head. Today instead of writing a column, I’m just going to reprint many of your letters. Some of you were outraged about the plan, while others urged its passing and still others came up with their own plans for the $700 billion.
Bailout, bailout, bailout ... it’s all bailout all the time these days, with every news organization (financial or otherwise) reporting rumors and innuendos from every politician regarding the government’s bailout package. Of course, the plan hit the fan in the House of Representatives on Monday afternoon, though the Senate passed it last night. The House is expected to vote again by Friday.
Successful investing is not about being wrong or being right, it’s about making money. And the best way for a growth stock investor to make money is to watch the market very carefully, to understand what its actions reveal about the thinking of the big institutional investors who move the market, and then to act accordingly.
I want to talk about innovation in the Green sector for a bit. The New York Times published a special section called the Business of Green this week and the story I wanted to share with you was about how some dairy farms are producing more than just milk and cow manure. Some dairy farms are generating electricity.
At the beginning of August, Cabot Benjamin Graham Value Letter featured four buy recommendations that collectively have outperformed the stock market indexes by a noticeable margin. I’m featuring one of the stocks here because it’s still clearly undervalued.