How To Make A Billion, Well, Maybe Just $100 Million, Sitting In Your Armchair
Photo credit: DON EMMERT/AFP/Getty Images
“Within a tempo, every beat has its own physiognomy” – Arturo Toscanini
If you confiscated all my dough but $10,000, I’d make my comeback. Gimme a desk, phone and legal-sized yellow pad with lines.
"Living well is the best revenge." There's the comparable "I'll never be able to spend all my money." This a more aggressive, egotistical utterance best left to retired block traders, quants and private equity operators. They do swing for the fences, but can tap out, overleveraged.
Sooooo… making it big comes with a mindset. Standalone time and somehow you cobble it together, leveraged maybe 10 to 1, backing your pics. I found Syntex, Xerox, Nextel Communications and Boeing early on. Polaroid was before my time. The common thread was primacy in an explosive industry, a lifestyle changer like "the pill" or cellular telephony, as in Apple. In the olden days you could leverage convertible bonds 10 to 1.
I live to inventory stocks where the analyst and money management community is seriously but legitimately at loose ends. These are "lady or tiger" stocks, not in-betweens. Past couple of years my paper embraced Boeing, Delta Air Lines, Alibaba, Micron Technology, even Apple, Microsoft, Plains All American Pipeline. Today it’s General Motors and AT&T.
At the bottom, spring of ‘09 it was Bank of America’s preferred stock at $5 and Citigroup's equity. Playing the "darkest before dawn" scenario is a courageous must, but diversify, not just a couple of stocks in 1 or 2 sectors.
Everyone should build his own lifetime list of great corporate manager-owners. My grouping covers Bernie Marcus at Home Depot (a 40-year investment). There's Irwin Miller who ran a great monolithic operator in diesel power – Cummins, which at one time sold at 30 times earnings, so I let it go.
Elon Musk qualifies, but I flubbed this one as too pricey. Tech heroes cover Joe Wilson at Xerox, obviously Bill Gates, Steve Jobs and Tom Watson, Sr., but in the sixties.
Jack Ma at Alibaba gets my money (10% of capital) but Jeff Bezos scares me so small position, under 5%. Mark Zuckerberg at Facebook is a solid maturer. For over 40 years I've played Rupert Murdoch, Steve Wynn and John Malone at Liberty Media. I still own ‘em, but they are mainly built out dominant players in their sectors, still imaginative and fearless.
They’re dozens of runners-up: Warren Buffett, but I’ve passed on him as too mature. Still dynamic operators include Sam Zell, Chuck Schwab and Carl Icahn, but I don't buy his one-off portfolio.
I've encountered many runners-up: David Geffen, Eli Broad (great L.A. museum), Steven Spielberg, Bill McGowan, Charlie Ergen, Steve Ross and Leon Hess. Throw in from the art world Jeff Koons and Damien Hirst. The common denominator is all surprised me and took their work to a much higher level than I could model on a sheet of semi-logarithmic graph paper.
Not a dreamer? Buy AA municipals with 5-year maturities. No Puerto Rican mufti-pufti, either. Leave random walks, risk premium comparisons and efficient market nonsense to assistant economics professors at Rutgers striving for tenure.
Warren Buffett in one of his 30-page tours d’horizon, early nineties, disposed of the "efficient market," in one sentence by referring to Black Monday when the market dropped some 20%, overnight, and came close to imploding. Never assume the guy on the other end of the phone is smarter than you.
Seldom remarked is our market topped out on August 26, 1987 and fell steadily for weeks. Interest rates ticked then over 8%. Macro stats stood wobbly: Weak dollar, rising trade deficit and a Congress that thought insider trading and Mike Milken’s LBO activity were the gut issues of the eighties. Gimme a break!
">Photo credit: DON EMMERT/AFP/Getty Images
“Within a tempo, every beat has its own physiognomy” – Arturo Toscanini
If you confiscated all my dough but $10,000, I’d make my comeback. Gimme a desk, phone and legal-sized yellow pad with lines.
"Living well is the best revenge." There's the comparable "I'll never be able to spend all my money." This a more aggressive, egotistical utterance best left to retired block traders, quants and private equity operators. They do swing for the fences, but can tap out, overleveraged.
Sooooo… making it big comes with a mindset. Standalone time and somehow you cobble it together, leveraged maybe 10 to 1, backing your pics. I found Syntex, Xerox, Nextel Communications and Boeing early on. Polaroid was before my time. The common thread was primacy in an explosive industry, a lifestyle changer like "the pill" or cellular telephony, as in Apple. In the olden days you could leverage convertible bonds 10 to 1.
I live to inventory stocks where the analyst and money management community is seriously but legitimately at loose ends. These are "lady or tiger" stocks, not in-betweens. Past couple of years my paper embraced Boeing, Delta Air Lines, Alibaba, Micron Technology, even Apple, Microsoft, Plains All American Pipeline. Today it’s General Motors and AT&T.
At the bottom, spring of ‘09 it was Bank of America’s preferred stock at $5 and Citigroup's equity. Playing the "darkest before dawn" scenario is a courageous must, but diversify, not just a couple of stocks in 1 or 2 sectors.
Everyone should build his own lifetime list of great corporate manager-owners. My grouping covers Bernie Marcus at Home Depot (a 40-year investment). There's Irwin Miller who ran a great monolithic operator in diesel power – Cummins, which at one time sold at 30 times earnings, so I let it go.
Elon Musk qualifies, but I flubbed this one as too pricey. Tech heroes cover Joe Wilson at Xerox, obviously Bill Gates, Steve Jobs and Tom Watson, Sr., but in the sixties.
Jack Ma at Alibaba gets my money (10% of capital) but Jeff Bezos scares me so small position, under 5%. Mark Zuckerberg at Facebook is a solid maturer. For over 40 years I've played Rupert Murdoch, Steve Wynn and John Malone at Liberty Media. I still own ‘em, but they are mainly built out dominant players in their sectors, still imaginative and fearless.
They’re dozens of runners-up: Warren Buffett, but I’ve passed on him as too mature. Still dynamic operators include Sam Zell, Chuck Schwab and Carl Icahn, but I don't buy his one-off portfolio.
I've encountered many runners-up: David Geffen, Eli Broad (great L.A. museum), Steven Spielberg, Bill McGowan, Charlie Ergen, Steve Ross and Leon Hess. Throw in from the art world Jeff Koons and Damien Hirst. The common denominator is all surprised me and took their work to a much higher level than I could model on a sheet of semi-logarithmic graph paper.
Not a dreamer? Buy AA municipals with 5-year maturities. No Puerto Rican mufti-pufti, either. Leave random walks, risk premium comparisons and efficient market nonsense to assistant economics professors at Rutgers striving for tenure.
Warren Buffett in one of his 30-page tours d’horizon, early nineties, disposed of the "efficient market," in one sentence by referring to Black Monday when the market dropped some 20%, overnight, and came close to imploding. Never assume the guy on the other end of the phone is smarter than you.
Seldom remarked is our market topped out on August 26, 1987 and fell steadily for weeks. Interest rates ticked then over 8%. Macro stats stood wobbly: Weak dollar, rising trade deficit and a Congress that thought insider trading and Mike Milken’s LBO activity were the gut issues of the eighties. Gimme a break!
https://www.forbes.com/sites/martinsosnoff/2017/09/25/how-to-make-a-billion-well-maybe-just-100-million-sitting-in-your-armchair/
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