Why Investing is Great, Election Thoughts, and Other News from the Business World-

The summer has been very interesting, and in many ways very rewarding for me personally. The rewards I mention are not financial, though I am sure you would agree there is nothing wrong with a few extra bucks in your pocket. No, what I am talking about is the gratification that comes from being associated with people who in some way you may have helped. Specifically, there are people who are clients of mine who in some minor way I have helped through investing. For example, I recently recieved notice that a client who opened a new business had the enterprise go live with a very interesting business. We talked about the idea and he has refined it into a product which has a great deal of potential. One never knows how these things play out as the business world is tough in almost every area, certainly in markets which offer large rewards. Still, helping people start and reach for their dreams is wonderful and very gratifying.



Another example is a client who is very diligent recently sent me an email notifying me of an upcoming appearance on television for her small business. She is a super lady who tries very hard with her candy business, and I was overjoyed to see the television spot and I hope it really helped with her orders.



A few other anecdotal stories deserve mention as well. A young man recently came to me with some money he wants to invest. He is only 13 years old but he has already saved some capital and wants to see it grow. He is also interested in learning about investing so I gave him some informtion about books to read and how to pursue his objectives. As I get older, and I think most people who have had success financially might agree with this, more focus and satisfaction comes with helping others attain their dreams. You realize people are not that concerned with rates of return, but having enough money so they have the freedom to do what they want to do. It may be retiring early, buying a new house, renovating a new house, starting a new business, expanding an existing enterprise, sending a child to college, whatever. Investing money successfully can help people do those things, but it certainly is not easy.



Investing is spending money today so you will have more money in the future. Just as important, is how any individual is forced to grow intellectually by investing. You can spend money without knowing anything about what you are investing in, which in my mind is not intelligent. When you invest and work at it, you learn about the entire world, about what companies are doing all over the globe, and almost every sphere in the world affects your companies. Weather, sports, politics, culture, music, fashion, nothing should be ruled out. As a result, an investor is constantly forced to learn, which means you are growing. You grow or you die. While you are at it, there is plenty of struggle and adversity, but the rewards are well worth the effort.

We are now, as Lincoln said, "Getting to the stub of it.", regarding the upcoming presidential election. The conventions are in the next two weeks and the debates will follow. I recently read where only 5%, or 15 millon people out of 300 million in the country, will decide the outcome. I am sure you might agree neither side will probably call you after they win to see what your thoughts are on how to proceed forward. What will be very interesting is to see how both parties approach the election. The important issue is which leader is better able to lead the country in the future. Politics is a subject which you cannot avoid and there is much to hate about it. However, the next few months will be interesting for any observer, whether you vote or not.

Apple defeated Samsung in a trial regarding patents for phones. The result is the smart phone business will get more competitive. The companies most affected by the decision are Apple, Google, and Microsoft, all financial and cultural heavyweights. Personally, I think the first two are in the strongest positions and I think they have all been great businesses. However, in the future I would not go against Apple or Google.

http://www.bloomberg.com/news/2012-08-25/apple-patent-victory-seen-spurring-wider-range-of-smartphones.html

Mario Batali is a legend in the culinary world and has some great advice for any enterpreneur in this interview-

http://www.nytimes.com/2012/08/26/business/in-mario-batalis-kitchen-please-refrain-from-shouting.html?ref=business

Apple is introducing a new mini-Ipad and a new I-phone in the fall.

https://allthingsd.com/20120825/confirmed-new-ipad-mini-will-debut-in-october-after-latest-iphones-september-bow/

John Bogle is a giant in investing world and has some great advice for any investor. I personally disagree with his ideas about index investing versus active management, but I do think index investing is a great way to invest for a lot of people. http://seattletimes.nwsource.com/html/businesstechnology/2018994009_bogleworry26xml.html

The online poker controversy just gets worse. http://www.lvrj.com/business/online-poker-s-window-of-opportunity-may-be-closing-167464895.html

Finally, I hope all readers have a great week, if you have any comments, thoughts, questions, or ideas about the blog post, please share them! Thank you for reading.

Y H & C Investments, Yale Bock, and the family of Yale Bock own positions in securities mentioned in the blog post. Investing in stocks can lead to the complete loss of your capital
. As always, on any company mentioned here, past performance is not a guarantee of future returns. Investing involves risk of losses on invested capital. One should research any investment and make sure it is suitable with your objectives, risk tolerance, risk profile liquidity considerations, tax situation, and anything else pertinent to your financial situation. Also, the CFA credential in no way implies investment returns will be superior for any charterholder.

Here are some Seeking Alpha articles Yale Bock has written about specific companies.

Romney/ Ryan vs Obama/Biden, California, and the State of the Market-

The dog days of August are on us and the never ending summer heat is at its zenith. Hopefully in a few weeks, temperatures will moderate some and the environment will turn pleasant. The mood in the country is as difficult as the weather. In the forefront of anyone with a pulse is the upcoming presidential election. Voters will face a clear choice between the Romney-Ryan ticket and the incumbant Obama-Biden pair.

I would imagine both sides would agree the country will deserve the winner. A legitimate question which faces the victor is can they work with the defeated side? The advertising campaigns on both sides are doing everything and saying anything possible to discredit the opponent. Staring those same people in the face after you win presents a major problem. One might say it does not matter, but it does and one only needs to look at the lack of accomplishment of our current government to prove the point.


Governor Romney brought up the case of what is happening in California as potentially what could happen to the United States if our government does not start to address the financial issues it has. Naturally, Jerry Brown, the governor of California, says Romney is misguided. California is running a deficit of 10 billion dollars, up 50% from what it thought it might run. The state is losing citizens and businesses because of the financial problems, delusional legislature, and a myriad of regulatory red tape which would frustrate any reasonable business owner. The New York Times recently had a piece in it about how France is going to raise tax rates to 75% for millionaires, and many business owners in France have already left, or are considering leaving. California is facing the same issue and it will continue until people with common sense figure out how to come to an agreement on practical rules for spending and taxing.


Stock market psychology is a reflection of what is happening in all over the world, and I recently read where sentiment about the market is at a 27 year low. Very few people have any interest in the equity market. For experienced investors, this is music to their ears as they want to invest when everyone hates stocks because you get better prices. Time will tell as to how things play out, but I know which camp I am in.


The Olympics ended yesterday and there were no tragic incidents. I am happy the games went so well for the British as they had a smashingly successful two week run. Apparently, the shopping really picked up and certainly the US performance helped on that end.


Facebook's lockup period ends pretty soon and if you thought the selling was bad before this-http://www.nytimes.com/2012/08/13/technology/facebooks-stock-has-suffered-but-some-investors-see-value-now.html?_r=1&ref=business



If you wonder why Mitt Romney does not want to release his tax returns, look no further than this story-http://www.nytimes.com/2012/08/14/us/politics/sheldon-adelsons-dealings-in-china-are-under-investigation.html?ref=business

Thank you for reading the blog, and if you have any comments or thoughts about the blog, or thoughts, please post them!

Y H & C Investments, Yale Bock, and the family of Yale Bock own positions in securities mentioned in the blog post. Investing in stocks can lead to the complete loss of your capital. As always, on any company mentioned here, past performance is not a guarantee of future returns. Investing involves risk of losses on invested capital. One should research any investment and make sure it is suitable with your objectives, risk tolerance, risk profile liquidity considerations, tax situation, and anything else pertinent to your financial situation. Also, the CFA credential in no way implies investment returns will be superior for any charterholder.

Here are some Seeking Alpha articles Yale Bock has written about specific companies.

Summer Fun, Mr. Market is Blue, and Romney's Strategy-

The summer is continuing to wind down, and oh, what a few months it has been, in all kinds of ways. My focus is the markets, and specifically the stock market. One of the things I always notice is when things get difficult in the stock market, all of the same detractors and naysayers love to pile on and emphasize the world is going to end. I write from the perspective of someone who is long the market, meaning over the long term it will go up. What is really tough for stock market investors is there have been so many events which lead people to say 'Why bother with this nonsense?'



Over the last few months, investors have gone through the continuing problems in Europe, the Facebook IPO debacle, and this week's Knight trading malfunctions. On a daily basis, you see companies which miss earnings estimates by a few cents, and the market value of the stock will get hammered by 20-30% or more. I have seen stocks go down by 50% or more with downward guidance. Are these punishments really fitting of the crime of reduced guidance? I think not.



You have a situation where Mr. Market, as Ben Graham calls it, is in a mood which looks at the extreme negative all the time. No company gets the benefit of the doubt, regardless of the circumstance. As an investor, the valuations are compelling because of what is seen as uncertainty. However, much of the uncertainty will eventually end. The United States will eventually have our presidential election, and one candidate will win. Europe's debt crisis will result in a restructuring of the Euro currency, or the countries will find a way to work through the issues. China will eventually show improved economic growth, or will go through a lull. All of these problems will eventually reach a conclusion. What will also remain constant is companies which are making hundreds of millions or billions of dollars will continue to try to sell more products and services. You invest in these strong companies because they can endure the problems and work through them.



A nice article in the NY Times on the Long Term Value of Internet Businesses-http://dealbook.nytimes.com/2012/08/03/the-long-term-value-of-internet-companies/?ref=business



Business Insider tells us the favorite U.S. stocks- http://www.businessinsider.com/morgan-stanley-9-stocks-america-2012-7

Defending Mitt Romney's election strategy-http://www.businessweek.com/articles/2012-07-20/a-qualified-defense-of-the-romney-campaign#r=related-rail



Thank you for reading the blog and I hope you have a great rest of the summer. Please be healthy and and best wishes to you and your family members. If you have any comments, thoughts, or questions regarding the blog, please post them!!!!

Y H & C Investments, Yale Bock, and the family of Yale Bock own positions in securities mentioned in the blog post. Investing in stocks can lead to the complete loss of your capital. As always, on any company mentioned here, past performance is not a guarantee of future returns. Investing involves risk of losses on invested capital. One should research any investment and make sure it is suitable with your objectives, risk tolerance, risk profile liquidity considerations, tax situation, and anything else pertinent to your financial situation. Also, the CFA credential in no way implies investment returns will be superior for any charterholder.

Here are some Seeking Alpha articles Yale Bock has written about specific companies.