| An SI Board Since August 2006 |
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I understand the word 'Schlock' means...something cheap! With that in mind, I'm starting this board with the full admittance that my words are just that...cheap and not based on a crystal ball that is often emitting clear pictures. But I did learn many years ago that if you see a particular stock mentioned in prominent headlines, by then it is too late to buy the stock. Identify a stock that has a future...hold it until the fundamentals and rational for first buying it swings to the negative and only sell it then, and your odds of making money will be enhanced. Brokers live in large houses because people buy and sell on whims and decisions have no relevance to the future of a particular stock. Even in down markets, some stocks go up if there is merit to the stock! I often tell the story of one of my early wise investments and how it was based on a passing comment made by an oil company executive. This individual, in a casual conversation that occurred in 1979 during the famous oil crisis that hit our nation, mentioned that the future of oil and the price we would pay didn't look all that promising for consumers. He added that in the future it was critical that railroads would have to step in and maintain our economy by getting goods delivered as trucking would be costly.
His comments got me to thinking about the railroad industry, but I couldn't identify any railroad company stock that I would be willing to buy. Just by luck I came across the name of a company...Varlen. With further research I discovered that what Varlen did was refurbish diesel locomotives and made a mundane product that is called a railroad tie. These ties are used to hold the rails in place and have to been constantly changed due to the vibration of passing trains shaking them loose. Varlen was located in the Chicago area and I asked a friend that lived there to make a visit to their office and plant. His feed back told me that the employee parking lot was full and workers were on overtime and they had a backlog on refurbishing locomotives and turning out the railroad ties. End of story is that within months the stock zoomed and they were eventually bought out… much to my happiness!
So this board isn’t to promote individuals stocks, but rather what is perceived as being a future trend. Don’t just mention a stock, but rather, give a basis for how it applies to the future of the industry it is in. Trends can either be positive or negative. For example, a single product company with no proprietary rights is a company that is in for a rude awakening, if they have a viable product. Competition will eventually enter their market…merely look at Tempur-Pedic. A company with a foam mattress that people liked, but then competition under-cut them by about 50%...stock craters!
My first post will give an example of the goal that I have for the board….so I don’t expect daily post, but only when one sees a valid reason to share information on trends. If we can find trends then individuals can do their own research on particular companies
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