Most “get rich quick” schemes end up turning into “get poor quick” schemes. Reach too deep into the risk pool and you’re likely to fall in. I knew that 30 years ago, and in 1988 I wrote: I’m an ultra-conservative investor at heart…and by intent. I know my reputation in the industry puts me in the most cautious camp possible, and that’s just swell with me. My motto has always been, “Get rich slowly with compound interest.” At even a 7% rate of return, money doubles in about ten years. In IRA, Keogh and other retirement accounts, over half of total return should come from dividends and … [Read more...]

In September of 1992, I outlined the tragic story of a MLB slugger, Jack Clark who had misspent his money and wound up in bankruptcy. I wrote: It’s Time for Bankruptcy Not for you of course. No, I’m writing to you about bankruptcy for Jack Clark, Boston Red Sox slugger, but this story carries a lesson for most of us. Now here’s a guy—a good guy, too—with a three-year Red Sox contract worth $8.7 million. And yet Jack is bust. He has listed $11.5 million in debts, versus only $4.8 million in assets. Clark owns 18 automobiles, including a $717,000 Ferrari. He dumped over $1 million into … [Read more...]

Bond yields are rising, tech stocks look shaky, emerging market currencies are tanking, and in the midst of the longest bull market in history, September property sales in Manhattan are down 39% compared to 2017, with median sales prices falling 9% during that time. There are some warning signs flashing. What should you be doing now to prepare for a future downturn? In April of 2002 I wrote: Here is a historical goody that will offer you much comfort. In every stock market downturn since 1950, with one mini-exception, intermediate-term U.S. Government bonds have risen. Talk about the power … [Read more...]

This is the advice I gave professional athletes and my readers twelve years ago about how to make your retirement dollars last a lifetime. I wrote: I advise you regularly to invest only for dividends or interest. I want you to insist on getting paid, as I do. If you want to speculate with a portion of your capital, that's fine, but do not mess with your primary stash of cash. When you retire, your earning years are over. Kaput. You earn no more. Therefore, every dollar you have the day you retire must be treated with the deepest reverence. Treat each dollar as you would a family member. Would … [Read more...]

Don’t try to be a know-it-all investor. Building a solid foundation on diversification, patience, value, and compound interest, has always worked for me, without having to “know it all.” In 2003 I explained my deliberate method of focusing on dividends and interest to generate compound interest, writing: Invest for Dividends & Interest I’m not a speculator or trader, and I don’t offer strategies for either group. Work hard, invest your hard-earned savings regularly for interest and dividends, and let your investments breathe. Let them take the air. Let them work for you as a … [Read more...]

The simple act of avoiding major losses by diversifying my portfolio and focusing on value and compound interest has allowed me to emerge from the investment war as a winner. It can work for you too if you have the patience and endurance for such a strategy. This method is all about risk management, something I wrote about in December of 2003. Dead Aim… “When the difference between life and death can be counted in milliseconds, you need every advantage you can get. Which is why SureFire developed its Special Operations series to be the best extreme-duty tactical illumination tools in the … [Read more...]

It can be easy to forget the lessons of the past as the current bull market seems to run infinitely onward. Overextended stock market valuations have a habit of correctly quickly and unexpectedly. Once the crash hits, it’s often too late to rebalance a portfolio into more defensive sectors. Market rebounds have a similar time horizon. Once investors realize markets are on an upward trajectory, many of the best days of returns have been left behind. If you are caught out of the market, waiting for that perfect moment, it’s already gone. To avoid the dangers of market timing, develop a … [Read more...]

Over the last few years you have seen just how badly so-called gurus can get a prediction wrong. The complete failure of “experts” to predict Brexit, the election of Donald Trump, and even the economic implications of a Trump Presidency are good examples of how seemingly sound predictions can lead folk astray. Market predictions are the same. In May of 1995 I warned readers away from placing their faith in forecasts with a little set of examples I’ve quoted for you here: Last fall when I told you that 1995 would be a decent year for the stock market, I was not making a prediction. Rather I … [Read more...]

Yes, when you ask yourself the question “Will I outlive my money?” it’s true, it doesn’t exactly elicit a warm and fuzzy feeling. Sweaty palms is more like it. But it’s a question we all wonder about, especially after booking Business Class to Paris. Sorry kids! In my first conversation with prospective clients, I can usually tell within about 17-seconds whether or not we’re a good fit. It mainly has to do with a grasp of reality. The cold reality of our recommended draw rate of three to four percent per year can set an early tone. And hearing “the lower the better” most definitely … [Read more...]

One of the investing mistakes that some make in high growth glamour stocks is extrapolating today’s growth rates and profitability forward without accounting for future competition. High growth markets with high returns on capital attract competition. And too seldom is the impact of increased competition accounted for in future results. Tesla is the largest car company in America even though it produces a fraction of the cars that Ford or GM produces. That is partly because investors aren’t baking enough competition into their calculations of future profits. The same scenario appears to be … [Read more...]