Value Investing Lessons from Allan Mecham (30% CAGR over 8.5 Years)
Issue No. #019
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Today at a Glance:
Lesson From the Book: Lessons from Major Bear Markets
Tweet: Learn Value Investing from Allan Mecham
Quote inspired from Guy Spier
Snippets: When to buy and Warren Buffett's 3 core concepts for stock picking that he'd learned from Benjamin Graham
Lessons from Major Bear Markets (Book)
People who bought stocks at the high point in 1929 (this was a small group, fortunately) had to wait twenty-five years to break even on the prices. Imagine your stocks being in the red for a quarter-century! From the high point in 1969 before the crash of 1973–74, it took twelve years to break even. Perhaps we’ll never see another bear market as severe as the one in 1929—that one was prolonged by the Depression. But we can’t ignore the possibility of another bear of the 1973–74 variety, when stock prices are down long enough for a generation of children to get through elementary, junior high, and high school.
It would be nice to be able to get a warning signal, so you could sell your stocks and your mutual funds just before a bear market and then scoop them up later on the cheap. The trouble is, nobody has figured out a way to predict bear markets. The record on that is no better than the record on predicting recessions. Once in a while, somebody calls a bear and becomes a celebrity overnight— a stock analyst named Elaine Garzarelli was celebrated for predicting the Crash of 1987. But you never hear of somebody predicting two bear markets in a row. What you do hear is a chorus of“ experts” claiming to see bears that never show up.
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One Tweet
One Quote
Don't read books to sound intelligent at dinner parties; read books for mining useful ideas to implement in your life
- Inspired from Guy Spier
Interesting Books Snippets shared during the Week
1. When to buy (Book)
2. "You might think you want a fancy car or a nice watch. But what you probably want is respect and admiration." (Book)
3. Warren Buffett's 3 core concepts for stock picking that he'd learned from Benjamin Graham (Book)
