I certainly enjoyed reading "You Have More Than
You Think" by David and Tom Gardner(copyright 1998).
The advice in the book was rather conflicting. On the
one hand we have their version of the Dogs of the Dow
approach (probably not a bad approach if the whole market
isn't overvalued). Then we have the buy what you are
approach (which sometimes gets people in trouble because
they think that good news about a company they know
very well automatically translates into higher stock
prices). Then of all things we have the Obvious Greats
approach which means we are to buy the greatest stocks (in
the rear view mirror) of all time. This is a pretty
easy strategy. Just look at what has gone up the most
in the past 5 years, 10 years, or since 1919 and buy
it. It is certainly hard to refute this concept
because if you didn't buy what went up the most over the
past 50 years, you were obviously wrong. This was the
whole foundation of the Nifty Fifty ideas of 1972-74
and we know what happened then. This was a brilliant
masterstroke in financial book writing. It reminds me of the
books on buying real estate with no money down and
numerous other books that appeared at the top of previous
Now what is so interesting about
all of this is what a difference a couple of years
makes. In The Motley Fool Investment Guide our Motley
Greater Fools expound for 18 pages about the Fool Ratio.
The fool ratio comes about by comparing the p/e ratio
of a company with the growth rate of a company. The
book very carefully points out that these Motley Fools
want to buy a stock when the P/E ratio is 1/2 the
growth rate. For example, if KO was growing at 50% per
year, they would want to buy it at 25x earnings. They
want to look at selling stocks when they have a fool
ratio of one. In the KO example, if it were growing at
50% per year they would want to sell it when it got
to 50x earnings. In addition, they have a chapter on
short selling that indicates they would consider
shorting an issue when the ratio reaches 1.4.
we were to apply their ratio to todays numbers the
answers are a little ridiculous. Since KO earnings are
growing at 12.5%, the Motley Fools would be looking to
short the stock at 17.5x earnings or about $29.00.
Needless to say, this old fashioned stuff (the Motley Fool
Investment Guide is copyrighted 1996) doesn't fly anymore in
this new era.
Go on to part
You still don't have an "America,love it or leave
it!" bumber sticker on your American Motors car do
you? When we still continue to view the world as how
it "should be" according to our values then we do
indeed have a long way to go. I see you don't mind have
Coke-Cola profit from those lower on the food-chain than
ourselves... Sit back in your Laz-E-Boy recliner and wait for
you SS check to clear. I am glad that your generation
and it's mind-set are fast moving towards extinction.
the stocks they showed on CNBC were not KO
caliber stocks; they were companies whose management
probably screwed up. So, instead of taking the fall for a
lousy stock price they say, "Oh, um, someone said
something on a chat board that wrecked our stock, otherwise
it would be much higher." Please.
It is like
all these companies that blame their earnings
shortfall on Asia. They will never say, "We overestimated
what our success would be for the current quarter,"
instead they say, "Asia really hurt us, if it weren't for
Asia our earnings would be well above our most
optimistic projections," or something equally
BTW, why is it if a bunch of analysts are recommending
KO there is no alterior motive like they are scared
that they will lose valuable investment banking
business if they put out a sell recommendation? Or, maybe,
they need to keep the price going higher so they can
get their best clients out and cross them into
something else? Why aren't these outstanding individuals
labeled SATAN!! Why aren't they accused of being thieves,
child molesters, and pimps?
If you want to take
the moral high ground, at least be consistent.
If you will tell me why a man will post every day
on the Coke board if he has no stock hates the price
and will not buy in the next 50 years. you are trying
to trash the stock so you can cover .You are
dishonest and you have several names and the SEC is after
you . You spread false rumors about Buffett selling
or buying , rumors that you start to mislead and
confuse , You knowingly post, that there is massive
insider trading (selling) and you know that is a lie
(only exercising options ) no I dont like you I don't
trust you and your gentle nature is a ruse to further
mislead. These boards do have an effect on the market as
stated today by the spoksman for the SEC,on CNBC. I hope
they nail your lying butt. and your alter-ego . They
showed the Yahoo post screen on TV did you miss it
?because you are still here. and all your lying posts are
still here with your name attached. how many other
stocks do you trash in a day and what names do youy use?
Don't be so damn nice when you are picking pockets .
Your true nature is obvious.
I actually like it here right now, as you already
know I short it with confidence and it can't go up. I
am keeping some short for August covering. AND on
top of that I in-out every day. I would have had to
work harder if the stock was lower, cuz then the risk