Join me at the Stansberry Conference in Las Vegas; 7 Stocks to Hold for 10 Years; Inequality Is Holding Back the U.S. Economy; Pennsylvania couple busted; Class participation strategy No. 2
1) A week from Monday, my colleague Enrique Abeyta and I will present four of our best stock ideas at the annual Stansberry Conference at the ARIA Resort & Casino in Las Vegas.
I attended and spoke at the three-day event a year ago and really enjoyed it. Stansberry has a fabulous lineup of speakers who will share tremendous insights and a wide range of great investment ideas. You can attend the event in person or watch the livestream – just click here for more details.
2) Speaking of stock ideas, in this video from one of our seminars a year ago, Glenn Tongue and I answered a student's question about 7 Stocks to Hold for 10 Years (2:12).
3) These two articles caught my eye. The first, a WSJ "Heard on the Street" column, argues that Inequality Is Holding Back the U.S. Economy. Excerpt:
But inequality may also change the way the economy works, points out Karen Petrou, who runs policy-analysis firm Federal Financial Analytics Inc. Rich people are less likely than others to spend additional income, for example, leading to reduced growth and inflation. And because the rich tend to invest that extra money instead, it can lead to increased asset prices.
And then I read this article, Pennsylvania couple busted for spending $120K mistakenly deposited into bank account, which vividly reinforces the fact that lower income folks are more "likely than others to spend additional income." Excerpt:
The husband and wife were hit with felony charges of receiving stolen property and theft on September 3 for blowing through just over $107,000 – on a $14,500 Chevrolet SUV, a race car, two four-wheelers and $15,000 in payments to friends, among other things – after their area BB&T bank teller accidentally deposited $120,000 on May 31, state police records show.
4) Last week, I wrote about the new book by Netflix (NFLX) co-founder and former CEO Marc Randolph, That Will Never Work: The Birth of Netflix and the Amazing Life of an Idea.
I just finished it and really enjoyed Randolph's stories from the earliest days of Netflix. (The book ends soon after the company went public in 2002.)
My favorite story was when he and current CEO Reed Hastings met with the CEO of Blockbuster, who laughed them out of the room when they proposed being acquired for $50 million! Here's a Vanity Fair article about it: He "Was Struggling Not to Laugh": Inside Netflix's Crazy, Doomed Meeting With Blockbuster. Excerpt:
It was hard not to feel a bit intimidated. It was partly the loafers. Antioco was wearing beautiful Italian shoes, and I was in shorts, a tie-dyed T-shirt, and flip-flops. Reed's T-shirt was crisp, but it was still a T-shirt. And Barry, always the best dressed of the group... well, at least his Hawaiian shirt had buttons. Really, though, we were intimidated because Blockbuster was in a much stronger position. Flush with cash from its recent IPO, it wasn't dependent on the good graces of V.C.s to keep it afloat. It wasn't struggling with the scarlet letters ".com." There's nothing like going into a negotiation knowing that the other side holds almost all the cards.
Key word: "almost." There were, in fact, a few points in our favor. To start, everyone hated Blockbuster. This, after all, was a company that had "managed dissatisfaction" as a central pillar of its business model. It knew that most customers didn't enjoy the experience of renting from it, so its goal as a company wasn't so much to make the customer happy as it was to not piss them off so royally that they'd never come back. And there was a lot to piss them off: late fees, crappy selection, dirty stores, poor service – the list went on.
But the most important point in our favor was the inexorable march of progress. The world was going online. No one knew exactly how, or how long it would take, but it was inevitable that increasing numbers of Blockbuster's customers would insist on transacting online. Not only was Blockbuster ill-positioned to take advantage of that trend, but it didn't even seem to see it coming. The way we saw things, it could use our help. We just hoped it could see it that way too.
5) Here's my next strategy for winning the class participation game...
2. Speak up, but not too much.
To get the highest class participation grade, you need to speak more than average... but not too much. Otherwise, you'll earn the resentment of your classmates and the professor will likely stop calling on you. The right amount will depend on how many students are in each class and how long the classes last. In my experience with 80-person, 90-minute classes, speaking every other class was just about right.
Best regards,
Whitney