Malcolm:
Thank you for your generous post. I would like to set the record straight on a few points, however. First, I am not a blind optimist. The fact that my posts are seen in that light on BB&R is more a commentary on the tone of this board than it is on me. I am not a mindless cheerleader for the US, for the Republican Party or for George Bush. George Bush is a dangerous simpleton, but his free-market, capitalist values are closer to mine than are those of most Democrats. I have nothing in common with most Republicans, who are religious, socially conservative ideologues. I am an atheist, socially-liberal free-thinker who happens to believe in the invisible hand of capitalism. My attitude towards the US is one of enthusiastic realism - it's better than the alternatives.
My success in the US is hard-won and moderate at best. I have been here twenty-one years after arriving with two suitcases and $300 in my pocket. I borrowed money to attend graduate school, worked for Jack Welch, left GE to run two different mid-sized manufacturing companies, was fired from both companies for doing the right thing and now provide employment to a small number of Americans in a company I started. I am a little guy, just like everyone on SI.
I do not recommend individual stocks because it is against my strongly-held beliefs to do so. Anyone who comes to SI looking for stock picks that will make them rich is a fool. Traders do not get rich. There are only a handful of people on the planet who can pick companies, buy their stocks at the right time, sell them at the right time and do this over and over again, year after year in order to beat the indexes by double-digit margins. I am not one of them.
There is a sure-fire way to get wealthy, however, and that is to identify macro-trends, identify the sectors that will do well as a result, and then buy and hold the leading companies in those sectors. Ask Warren Buffett. The right sectors now and for the next five years are technology, financial services and health care. This is not an exclusive list. Because managing a large stock portfolio well is a full-time job, I no longer try to do this. I spend my time on building my business and with my family. I do spend time however picking money managers who invest using the principles of Buffett and Graham & Dodd. There are money managers out there who can consistently beat the S&P by 5+% and I have given the majority of my investment portfolio to these guys.
If you want stock recommendations, Malcolm, it is my opinion that you should be committing right now to large cap tech and internet stocks like MSFT, INTC, QCOM, CSCO, CMCSA, EBAY, YHOO. I think there is a very good chance that this kind of portfolio will appreciate by 500% or more over the next 5 years as we experience the third leg of the great bull market through 2009-2010. Let me offer an analogy - GM's stock fell by 75% from 1920 through 1922 during the early 1920s tech wreck, then approximately doubled from 1922 to 1925, and then increased in value by a factor of 11 from 1925 through 1929. The internet/broadband sector may well follow the same path as the automobile industry in the 1920s as it achieves 95% market penetration by the end of this decade. |
