Chispas:
Great commentary and one that brings back potent memories.
- I was fortunate enough to have been a member of Canada's Olympic team in both 1976 and 1980 (also as a sailor), hence I know the identity of the referenced "genius"..... and it is an accurate observation.
I also had a somewhat similar warning in the delightful summer of 1987. At that time, I headed up a tiny venture capital company. Wisely or unwisely, I had cajoled many of the top dogs in several large Canadian investment houses to "invest" in a modest venture capital fund that I had founded in 1985. In August of 1987, several of those astute gentlemen invited me to lunch. At that lunch they lauded my efforts ("you have found, funded and "godfathered" several excellent start-ups"), but also warned me in no uncertain terms that my tiny fund would go down if I did not "pay attention to the deteriorating economic conditions and act accordingly" (i.e., fill my depleted treasury).
My response was as one might expect of a relative newcomer to the markets.... "What do you guys see that I don't?" Of course their list was as long as my arm. Unfortunately, while some of their concerns made sense, the overwhelming bullish market sentiment of that period caused me to do little more than "worry" about their list and occasionally dig into its implications.
Of course, when "Black Monday" struck in October of 1987, my fund, as well as the very promising companies that we were nurturing, all went down. Why? Because an environment in which one could effortlessly raise venture capital if one's start-ups were making progress, suddenly became a money raising desert.
Even today, I recall that period with considerable pain,but at least I gained from the experience,... I vowed that I would never again be crushed for want of an understanding of emerging market forces and emerging economic trends,.... or at least not for lack of trying to understand same..
Unfortunately, one is "always and forever" the product of one's experiences and it took me far too long to recognize that determined central banks can indeed hold back apparent rising economic tides...at least for periods of time,..... by stuffing the crumbling levee walls with newly printed greenbacks. "Earlie" is a self-imposed nick name, that daily reminds me that many economic hurricanes must come ashore before a "perfect storm" finally changes investor behavior.
Like my confreres of that misty summer of 1987, and like many of those who post on this thread, I too now possess "a list as long as your arm" of items that scream that a cliff looms ahead. And like those wise gentlemen, I also know that it is near and that it cannot be avoided. Finally like them, I can't provide a definitive date, except to say as they did..... "soon". I hope I am better prepared this time around.
Best, Earlie |
