Why I Turned My Back on Wall Street 20 Years Ago
Editor's note: As an independent financial publisher, we only serve one customer...
We base our business on subscriptions, not advertising. We don't manage money. We don't write about securities to broker them. We do it to educate our readers about the markets.
As Porter says, our main job is to give you what we'd most want if our roles were reversed. We're continuing with that philosophy in today's Masters Series – adapted from the November issue of True Wealth and last Tuesday's issue of our free DailyWealth e-letter...
In this essay, editor Steve Sjuggerud explains how he got started in the financial-publishing industry many years ago... and answers one of the biggest questions he heard from our subscribers during the recent Stansberry Conference in Las Vegas...
Why I Turned My Back on Wall Street 20 Years Ago
I'm proud to share an incredible milestone with you today...
As you've likely heard by now, Stansberry Research has been around for 20 years!
Porter Stansberry and I had two simple ideas when we started our little publishing company back in 1999...
- We wanted to deliver world-class investing ideas – written in plain language that basically anyone could understand.
- We didn't ever want to make a "quick buck" at the expense of our customers... Instead, we wanted to build a long-term business by always doing what's right for our subscribers first – believing that the rest would take care of itself.
Our two goals worked... Today, we have hundreds of thousands of loyal customers. We are flattered and humbled. Thank you!
To show you how far we've come – and how much this means to us – I want to "pull back the curtain" and tell you how I got started in this business. And I want to show you a key way we're staying true to our vision today.
Porter and I shared some of our early memories with readers last month as we celebrated the 20th anniversary of Stansberry Research during our annual Las Vegas conference.
One of those memories was how I got my start in the newsletter industry. It all comes back to our two simple goals...
I'd just quit my job as the vice president of a global mutual fund. I distinctly remember going over to my girlfriend's apartment complex and telling her what I'd just done.
I told her I wanted to do something else. And then, right there on the pool deck, I laid out a half-dozen investment newsletters from other analysts.
"I can do better than these, I think," I told her.
"What do you mean, better?" she asked. I didn't really know. "Can you make money doing this?" I didn't really know. "Well, how do you get readers?" Once again, I didn't really know.
It wasn't a thought-out plan... I just thought that I could help a lot of people do a lot better with their own money.
So I got my start in the industry working for an existing group. And a few years later, in 2001, Porter talked to me about starting my own letter... about writing whatever I wanted, with a "blank check" travel and research budget. I couldn't say no!
That was 18 years ago. The girlfriend asking the good questions by the pool soon became my wife... And now, Stansberry Research as a whole has just turned 20. Time flies.
Porter and I have changed a lot over the years (and I don't mean just our waistlines)... But our vision for Stansberry Research hasn't changed. We're still committed to sharing great investment ideas that anyone can use to take charge of their own money. And we're still committed to putting you – our customer – first.
So if you're a loyal subscriber, we'd like to thank you. It has been a great 20 years... better than we could have ever imagined. And we're looking forward to many great years from here.
But the thing is, we're not done yet...
As I said, we recently celebrated once again with subscribers at our annual Stansberry Conference in Las Vegas last month. During the conference, dozens of readers stopped me to ask questions. And one of the biggest involved my thoughts on the market's Melt Up...
Is your Melt Up thesis still in place? Stocks have done nothing – at best – for months. It doesn't feel like a Melt Up!
I couldn't believe all the fear I heard from readers in Vegas...
I'm scared, Steve. We've got the trade war, impeachment proceedings, and plenty of other uncertainties. Not to mention most folks are expecting a global recession to begin any time.
Plus, the market has been flat for months... Is your Melt Up ever going to arrive?
Wow! Let's take a close look at what's really happening out there...
You might not have noticed, but earlier this week, stocks closed at an all-time high.
That, my friend, is a bull market. And let's size up this bull market for just a moment, before we think about how to proceed...
- The benchmark S&P 500 Index is up from roughly 2,000 points in 2016 to more than 3,000 points today. That's a 50% gain – not including dividends – in just a few years.
- Looking at a shorter time frame... The market is up about 30% from its Christmas bottom. That's less than a year ago!
- Looking at a longer time frame... The market bottomed in 2009 at a level of 676. So stocks are up around 350% (again, not including dividends) since the 2009 bottom.
Instead of asking when the Melt Up will arrive, I expected my readers to ask an entirely different question: "The market is hitting new highs – shouldn't I be scared?"
My answer will shock you... The facts will shock you...
You might think that stocks reaching an all-time high would be bad news. When you've reached the peak, how much higher can you go?
It turns out, we're not talking about mountain-climbing here...
Since 1950, stocks have hit new all-time highs more than 500 times (and that's just using weekly data).
What happened six months after those highs? What happened a year later?
It turns out, stocks were up – a lot.
If you were simply a "buy and hold" investor, you would have made 7.7% a year on stocks during that time (not including dividends).
However, for the 52 weeks after a new high, stocks outperformed their typical return – delivering an 8.5% compound annual gain.
So, at the very least, you shouldn't worry so much! Stocks tend to outperform after new highs, not underperform.
More important to me, though, is the simple idea of "sentiment"... Basically, nobody cares about stocks today.
This isn't the bitcoin bubble or the housing bubble. Nobody is talking about their favorite stock picks at cocktail parties – yet. And trust me, when the Melt Up is in full swing, we'll see that happen.
So even though the stock market is up – a lot – over a very long bull market... we still have room to run. A lot of room.
But let me qualify that. The market has room to go much higher – but it doesn't have a lot of time to run higher...
Our indicators for when the bull market ends tell us that time is getting short. But I expect we'll have at least another year of gains.
Simply put, we're not there yet. So don't sit on the sidelines right now. Trust me – you'll have plenty of time to do that when we're on the opposite side of the Melt Up.
Take advantage of this moment – now. Get conservative later!
Good investing,
Steve Sjuggerud
Editor's note: Steve's Melt Up thesis is just one of the many investment ideas we've introduced to our subscribers over the past 20 years... At Stansberry Research, we've built our success on following the same core principles and sharing great ideas that anyone can use to take charge of his or her own money.
And right now, we're staying true to our vision in another specific way... It's something special we've put together in honor of our 20th anniversary. Get all the details right here.