The reason I'm here tonight in the reason I did two books is that I'm I'm very upset the fact that people lose money consistently in the stock market. People are careful with their money when they buy a refrigerator they do research when they buy a house they do research for some reason. They've been convinced by the media that the small investor and I don't know if that means people under 5 feet tall, but they're always called the small investor don't have a chance and it's okay. If you're convinced that you can't play basketball with the pros and you're like a junior high school team or you can shoot baskets or people convinced. You can't play the you're not a great violinist and you don't have a chance of being a concert Master you can play the violin but if you're convinced that you can't compete in the stock market that those professionals with their degrees and all the computers and all the money. They have a great Edge people start acting funny. The buy stocks one week and they buy another stock next week the buy stocks they know nothing about And that's led to people think the markets a casino and it's just led to terrible performance. I'm talking people that three or four or five thousand dollars is a huge deal to buy stocks the here a tip on a bus and they buy It Before Sunset and and when they get when they lose money they wonder and they say it's because of the those professionals and program trading and that wasn't the reason and and in a week later. They're doing a couple hours of research to save $100 in a round trip air ticket to Hawaii on people do that all the time and I'm here tonight. I've been on this for about 20 years trying to convince people. There is a relationship between the kind of research you do and what happens in the stock market and the first rule I want to cover is know what you own. People should be able to explain to a 12 year old in two minutes or less why they own a company and It ultimately in a lot of cases if you pin people aside and you said you're why do you own that company you really forcing? It's a the suckers going up that mean that that's you know, they really don't have no idea what they own and this is a this is the kind of company most people buy this is a relatively simple company they make this is what people love to buy this kind of company. They make a one megabit s Ram CMOS bipolar risk floating Point data Ira data I/O array processor with an optimizing compiler a 16-bit dual Port memory with the Unix operating system for Whetstone Mega flop poly silicon emitter. With a high bandwidth, I guess it's been a low bandwidth 6 gigahertz double metallization communication protocol asynchronous backward compatibility a peripheral bus architecture for Wave interleaved Memory token ring interchangeable backplane and 15 nanoseconds of capability. Now if you own crap like that. You are never going to make - stock market never it's hopeless be some you'll come out with more wagon Mega flops or less Mega flops or less gigahertz in a bigger back plane or a small backplane. You won't know whether it's better. It's all over for you and people love to buy stuff like this and The kind of stocks I bought were I'm not kidding the kind of sucks. I made money or Dunkin Donuts their department stores companies. I can understand Taco Bell. You know when when stocks go down as they often do if you own a Dunkin Donuts, you're going to look at it. You can see there's no better company in town. You don't have to worry about Korean imports and something inventing a you know, a better donut. You know, it just you understand the company and You laugh at this but it makes a huge difference because the Mark goes down a lot of times stocks go from 12 to 8. And if you own that first type of stock the CMOS s Ram megabit fella, you just have no idea what to do when it goes down at its by the best thing that happened it goes down because it goes up. You're probably buy more and then you then you're gonna lose anyway, it's the the it's totally futile point to it's totally futile predict the economy interest rates and the stock market. No one can do it. No one is predicted the stock market right more than once in a row. And they try to do it and they just it just doesn't work Alan Greenspan's the head of the Federal Reserve. He would admit he can't predict interest rates people tell you they can predict interest rates. Alan Greenspan's honest enough to say he can't do it. He could predict what short rates are going to be is some influence in that over the next 90 days but ask him what seven year treasury is going to be two years in our 30 year treasuries. He'd admit I have no idea but people spend all this time. They spent all his attention on trying to predict interest rates predict to the economy. It's not worth it in trying to predict the market. If you spend over 14 minutes a year trying to predict the economy or trying to predict the stock market. You've wasted 12 minutes. It's just it's just not worth it. You can do it. You can use your time more effectively. You can do it looking at companies there you can there you can use your advantages people have huge advantages and they throw them away. Absolute incredible advantages and that's what people ought to work on it. And then they ought to take advantage of these declines in the market. It is very easy. Math has been 92 years of century 50 to 250 times in 92 years of markets decline 10% or more. It's about once every two years of Market declines 10% All those 50 declines 15 have been 25 percent or more. So about once every six years 15 times in 92 years the markets decline 25% of more. So you say to yourself that's going to happen. I don't know when it's going to happen might happen two days from now two weeks from now two years from now is going to happen. I don't know when it's going to happen. But if I like the stock at 12 and it goes to 9, I'll just buy more you have to understand that and that's the key and then you're ready for it and you can take advantage of declines the market instead of trying to predict them. No one can predict them. I'd like to go over what I call the the 10 most dangerous thing people say about stocks the But before that I'd like to say something about what I saw when I when I in my career was about the economy. I remember a I'm sure a lot of people in this body and this audience were very actively employed in 1982 1982. We had a 20% prime rate with 14 percent inflation. 12% unemployment. Does anyone remember reading about that happening in 1981? Did anybody remember anybody telling you about that in 1981? I mean, I read all these magazines. No ever told me about it. We're going to the worst recession since the depression. I do remember very distinctly though the people in 83 so we're going to recession 84 is an 84 in a recession 8585 the sort of recession 8687. They said we have one in 88 for sure didn't happen in 89. They said we're going to recession then by the time 90 came along they stop predicting it and this is all people talk about is when the recession is coming and it's just not worth it. I'm not saying that economics is invaluable. When I talk to Sears and they tell me carpets are getting better the last couple months. I probably would spend the next week and a half looking at carpet companies when I'm at General Motors and they tell me steel prices are going up for the first time in three years or actually, it's might be 73 years. The that's a fact that I can do something in that when used car prices are up seven months in a row scrap prices rising inventories are declining those are facts. You can do something in that but trying to predict big picture things interest rates the economy shouldn't do it. Before we get to the 10 most dangerous things or like talked about you have plenty of time. People are an incredible hurry. They just learn such a rush. It's amazing to me Walmart went public in October of nineteen seventy. Ten Years Later you could have bought the stock. Adjusted for splits. The stock was 45 cents. They still are only in 15% of the country. They weren't even saturating that 15% the country. They had a great product great service. People knew what they bought it. They bought the product you could have bought at Walmart ten years after one public and made 40 times your money for. Oh, you know, you don't have to do that many times your life to make a lot of money you have plenty of time to research companies The Limited had 200 stores open you could have bought it. You could've bought it when they bought open their 400 stores made 20 times your money you have plenty of time to do the work and it's worth it, but people are very they want something today. They want something tomorrow. Somebody invented this term. Sometimes the Centre called play the market. Those three words are done more damage. People think of a game they want instant action doesn't work that way and you have plenty of time to research stocks. The 10 most dangerous things people say about stocks. It's gone down this much already. It can't go much lower. I remember a lot of people is from might remember. This is a good old Massachusetts going to call Polaroid. It went from a hundred forty-two about a hundred and five and in about a three month period people said if it gets under a hundred it would be a great buy a hundred is the key point and it kept going back and forth between a hundred five. Then it broke below a hundred. People said my God, it's gone from a hundred forty 295 how much lower can it go? Well within well in a year it was 216. And this is a company had no debt is not a companies go bankrupt. It just is so overpriced but people buy stocks just in the basis. It's gone down this much already how much lower can it go? I had this experience at Fidelity the I was in I was an analyst in I think back then John King was call on me and in the early 70s and we did work on Kaiser industries that I was an analyst in we bought the biggest block ever history of American Stock Exchange. We bought I think seven million shares of the stock the stock had gone from 26 to 14 and I said the fund manager Stephen how much lower can it go? It's gone from 26 to 14 and we bought any still I think the biggest block ever. Is it seven or eight million shares at 12 and a quarter. I said what I do I go - it's gone from 26 to 12 and a quarter. I mean how much lower can I go? What $10 they told my mother the Stock's gone from 26 to 10 how much lower can it go? Fortunately, she didn't listen to me because it went to 9 2008 and went to seven and went to six went to five and went to for and went to three and I was lucky enough because I understood the company did I knew they had no dead. They owned 60% of Kaiser steel own 40% of Kaiser cement 30% of Kaiser Aluminum all the Kaiser Engineers all the kinds of broadcasting Kaiser sand and gravel that about seven other Kaisers and and they a lot of businesses and they'd know Dad and it when the stock was three and a quarter the whole value the company was less than a hundred million. And I remember I said a hundred million men. You could buy for 747s. And I think now you get one engine in a part of a wing but back then you got four Boeing 747 surrounded million. I said something wrong this company's way undervalued. And it's good thing. I kept can telling people in giving the evidence. You can't go to zero because it they have no debt. They've good businesses because eventually liquidate the company distribute all the shares in their public companies and you get about $45 a share but I understood the company, but just buying if you just bought it on the basis that had gone from 26 to 11. You might have sold it at seven. You might have sold it five. You just you had no other reason you would have given up and fortunately I had the facts in the story. I was able to hang in there and and you know, it's a tough business. We used to have a joke of fidelity. The Christmas bonus is that let you work to next Christmas and fortunately this was between season. So I was able to make it through at the Actually the second one if it's this high already, how can I possibly go higher is even a more dangerous rule Philip Morris in 1951 adjusted for splits soul for 12 cents. In 61, it sold for 60 cents so you could say it's going to fivefold tobacco's it's not growing. That's a lot of money to make in a company not going anywhere. It's going it's gone up a lot people have this incredible. They love selling stocks are going up. So stocks come 12 cents to 60 is sell it ten years later. It's four and a quarter. It's up Sevenfold. Eventually, you would have sold your lost 500 fold by selling your stock and Philip Morris because it had gone up fivefold. Just selling a stock because it's gone up is a losing formula and people do that all the time. They can they will sell a stock because it's gone up and that's a that's the worst of all things because only a few times your life are you can have a big stock and it makes up for all your mistakes just a couple good stocks in the lifetime and caching mean just because they've gone up is a is terrible and I was honored one day because I get this call. I thought was a joke because they had a call at home and our middle daughter Annie answer the phone. This is about four years ago. And Annie was about nine and she said there's a Warren Buffett on the phone for you. And and I said this is going to be choked on my friends call me and I I got on the phone and Warren Buffett called me and he tell you to I don't even tell you stocks really rapidly and says gee I loved your book and my wife likes and I this is very exciting. I think he's very enjoyed in and and he actually want to use a part of my book and is a new report which was a great honor and he actually used a Ida Line This is selling good stocks that are going up just because it going hi. I said it's like cutting the flowers and watering the weeds. They want to put that exact quote in his and report and he did and I remember he told me a few know if you ever come to Nebraska. You don't come to Omaha and see me your name will be mud in Nebraska. So about a six months later. I went out there and visit him and it was a it was a great thrill. He's a best investor by a lot of all time and but he has written his Winters. He's a great society holds onto it. He thinks the perfect time I to stock his forever and it's a and And and he's proven. That's the way to do it number three. Eventually they all come back. It's not true the RCA RCA was a great company is a company that just about get back to its 1929 price when General Electric bought out RCA. It just about reaches 29 price. That's how overpriced. RCA was 1929 you'll remember some of these companies Manville International Harvester Western Union double knits floppy disks. None of these things ever came back. People saying a eventually they always come back. No, no, it's not true. It it doesn't work that way the I remember the case with with EDS. This is one of these things. I wish I had saved because it was ones reports. This is the coming Ross Perot ran that this in the early 70s. It was selling it 550 times earnings. It was growing very rapidly, but it's a 550 times earnings and we had this progress report from a major firm saying due to this growth rate the whole thesis of the report was the stock to sell it a thousand times earnings because it because of its growth rate and I didn't say this report. I really feel badly. I don't have these days incredible archival value, but and when it got bought out by General Motors it almost get in this economy had a great record the next 12 years when you get bought out it just about get back to that price that it was in the early 70s and at that and I remember those reports. I think it was from when the major firms I won't say it firm was but I think it Rhymes with rare old wrench or something like that at the I remember the they had a they report in this company said do the company declaring bankruptcy. We're taking off our by list. I remember in a it was you know, it's a friggin report and I and I wish I really feel badly. I didn't say that because it was it was definitely flamable at the it's three dollars. What can I lose? This is this is unbelievable to me how many people buy stocks because it three dollars are 250. I'm I hear this all the time. They say it's three dollars. How much can I lose now take a piece of paper out and write this one down because might help save save you trip over here tonight if you put $10,000 in stock at 50. And it goes to 3 and one of your friends puts $10,000 into 3. And it goes to 0 use exactly the same amount. It's all the money you put up. And it's the math is not that hard it the and people all the time are saying it's three. It's 21242. How much can I lose its most absurd statement of are these people definitely never took logic and colleges are very weak syllogism, you know the or high school it and the irony of it is that when people that make money there are there are people very few people but there are people make money selling short the people that make money selling short don't they don't short Microsoft. They don't show at Home Depot. They don't show the great companies when they're overpriced through temporarily overpriced. They short stocks it six when the down from 50. They short stocks at 5:00 when the down from 80 because they know they're going to 0 Sucks don't go to zero overnight. They just keep going slowly down and they're sure in the hell out of stocks at 483 this still shorting the stock and you wonder how can they get these shorts up you something has to buy them and the people buying them are these people saying it's three how much lower can it go? You know? Yeah. The It's always darkest before the dawn. This is probably a subject a lot of people were talking about before they came over here freight car deliveries. How many Hi people today. We're talking about free card deliveries. Gee, that's all that's usually a lot of people are interested this sit in this is a fact you this on the Jeopardy game. Anybody watch Jeopardy is my favorite games at the same era watch Jeopardy. Then then watch Wheel of Fortune after the image. That is the great thing about if they do a Jeopardy first you feel like an absolute fool after Japanese over and then when Wheel of Fortune's on you feel brilliant again, when it's over, they're very they're very smart the way they run it, but if you could this is definitely the $500 category free card deliveries, if you could answer any of these questions to you in Jeopardy the 1979. We deliver the United States 96,000 Freight cars. Two years later Frank, our deliveries had fallen to 41,000. That's the lowest in 17 years. So a lot of people are buying stocks because businesses get really crummy awful and they're buying all the companies that Supply the producer 848 cars supplied Freight cars because business was really bad. The next year it fell to 17,000. So he was 96 4117 the year after in all of the United States 1983 5700 Freight cars were delivered. Onshore oil rigs probably few more people know this story at 1981 4520. These little fellows are running turning left or right in the Oklahoma and Colorado and and in Texas 4520 on Troy oil rigs 1981 and 1984 to fall into 2200 and people are saying look how terrible businesses on that basis alone. Just because business is terrible. They start buying these stocks. Well two years later it is down to six hundred eighty six 1986 4520 2200 in 1986. 686 today. It's 605. We're talking a long time here. This is 12 years. Later. but people were were buying these stocks big time just because business was terrible and I was lucky. I follow the textile industry when I was an analyst and text them to see is these come he's been around a long time. They've been through a lot of depressions and the tough times West Point Pepperell. I think it was 1780 and JP Stevens 1803 and worldliness is when these new Companies 1904, so they've been through all the tough times and they was a great expression very useful expression in the textile industry about conditions. It's always darkest before pitch black the When business is terrible it can get awful if the Run gets more adjective pathetic terrible beyond belief and we have this technical term in the market is called suck. You know it really that's a stock market term gets beyond that just doing this people buying stocks because business is bad. It just doesn't work. That's no reason. It's maybe a research a reason to research in history, but it's certainly not a reason to buy it and a lot of people buy stocks just because business is awful. That's not a way to win. When it rebounds to 10, I'll sell. I know about what about this rule is but if you ever do that the stock for the next 15 years will will fluctuate between six and nine and three quarters or five and I'll never get to tent you know, it's the I mean if ever you pick a price, I don't pick around number pick nine and a half or something, but you know But if you have just because you paid 10 for stock or 12 or 16, it doesn't make any difference. The stock is either attractive or it's not attractive. You cannot buy or sell a stock on basis of what you paid for it. This is another rule that I've give me a lot of rules is another one to remember the stock does not know you own it. There are people there are people that really think I mean they think of stocks is like their children their grandchildren and their dog the stock does not it does have any idea that whether you're a nice person whether you're volunteering you're doing Junior Achievement Big Brother Big Sister, you know, you're a good spouse. I mean that's not doesn't know a thing about you and just to pick out some price and say if it gets back that price, I'll sell it never works at What me worry conservative stocks don't fluctuate much. ConEd fell 80% in price then went up six-fold Public Service, Indiana Gulf States Utility middle South long on and lighting all fell about 80% then tripled or quadrupled. This may be an oxymoron quality Texas Banks fell ninety to a hundred percent Eastman Kodak fell 60 percent saying that blue chips or conserva stocks don't fluctuate much is just not true. The average stock this Century has had a 50% range between its high and it's low C Average stock on your side change. That means it might have started your 30 sometime during the year sold at 36 and sometime during the year sold at 24. There's a range between its high and slow of 50% That's the average stock on the New York Stock Exchange stocks fluctuate quite a bit and fundamentals that companies fluctuate quite a bit. And people inherit companies they say this is a conservative company they inherit it and they say gee I I'll just hold on to it it you know when when mother was dying the last word she said mention what a relationship between a mother the last word you said do is hold on to your Long Island lighting or something. But I mean you think you could have put in something nicer but you know mother on her deathbed suit said do not sell the blank stock or at the that's not a reason to hold it because I think your grandmother your mother your father if they're on Long Island Along on light and had this plant called Shoreham the no one wanted and they're building it and was way over budget and was all these problems. I mean she probably are he would have got out May they want to sell the 32 but may they sold a 25 or 24? They wouldn't have let it go to 4. They would have kept up with the story. They would have monitor the fundamentals stocks and not like a lottery ticket. Is a company behind every stock and if the company does well the stock does well if the company does terrible the stock does terrible and there's no such thing as a conservative stock. There's good companies this mediocre companies this Bad Company's conservative stocks is is not a good term it. Look at all the money. I've lost. I didn't buy it. This is a This is an amazing one it. It again, this is important to write this one down if you don't own a stock and it goes up. You have not lost any money check do that. You check your check it out. It's through the only way to lose money is to purchase a stock and have it go down. I mean all these people talk about you know, I was going to buy a thousand shares of Microsoft and it's going to $40. I've lost 40,000 Microsoft and I was going to buy 10,000 Global Marine. It's going to three dollars of lost 60,000 and that one I mean, they just go on and on with his torture. I think in fact, there's friends or spouses have to cut out parts of the newspaper so that you know, like the bees or parts the Seas. They can't ever see the pricing structures. They keep torturing myself a years over how much money they lost in the stock. They didn't buy. And I did a book Irv mentioned in earlier one up on Wall Street who came out for years ago and I listed in the middle of book stocks a I think through L. I stopped at else that went up over tenfold. Well, I ran Magellan and they would might have been a hundred names that I didn't own. A through L. I stopped Adele's and you know I did well on Magellan and I missed lots of socks. You don't have to get them all. You know, you only have a few of them people tortured himself. They look at the paper every day and they think of this one they missed and they mean something goes up eight points and they think they Miss Allen and I swear some people say the markets of 25 points is if I own the whole Market I lost 1 billion dollars today, you know, yeah. I miss that one. I'll catch the next one. Always be leery of the next anything. It's a the next Toys R Us is going to be child world. The next Home Depot is going to be Scotty's the next price cup is going Warehouse Club. I mean the next never works. In fact, I can't believe it Steve Jobs name is company NeXT that company. I think it was a mistake right off the bat when it when he the company that the guy that would Wozniak started apple and Brilliant guy and did a great job but next I don't think was a good name. It wasn't a great product. But the any of these general rules don't work very well like the next anything or always people say by on dips. I've always been bothered by I always say you have to buy from dips. I always thought that was the way can make money the the the The stock has gone up. I must be right. The stock has gone down. I must be wrong. This is one of the major fallacies the stock market. You've probably heard these calls. I've always had a lot of problem this one you get a call from something. They'll say, you know, I bought this stock at 10:00. It's now 14 you ought to buy some and after it's over you one yourself. What does that mean? I mean why? I bought it a 10. It's now 14. You ought to buy it. And I think it took me about 10 years. If it's not I think what happened is in these are people you know that are really nice people that they're not trying to hurt anybody but I think what happens is they bought the sockets at 10. They really didn't understand they've got a little bit of it when I went to 14 they were convinced there, right? So then they bought a lot for themselves. And then they were you know telling other people about telling their friends tell everybody about it because the fact that went from 10 to 14 convince them they were right I bought stocks that went from 10 to 14. That then went to 12 cents. I mean if they triple you couldn't buy Hershey bar with them. I bought I bought stocks that 14 that went to 4 then went to 50. Just because the stock goes up doesn't mean you're right it all it just means is went up. It doesn't mean a thing. The Zapata. I remember this these are two companies. I was interested. The pot is the company that gave us George Bush was in 1932. When all his ribs were turning was the 32 32 dollars a share. Great earnings record the stock was roaring and going up in price all the time. Ethel adjusted for splits was selling for to Ethel made a product called tetraethyl lead additives is now this is something that you really I mean definitely one of these things in your sandwich and this is not a good product and everybody with knew that was just a matter of time before tetraethyl lead additives were going to be banned from gasoline. There them in. The only purpose of them is to raise the octane gasoline. So they were convinced that this stock they've been a crummy stock and was depressed because all the legislation starting to come out about getting rid of lead and Lead wasn't good for your health. And so people said stocks down a to it's going nowhere. Well, the odd thing was it turned out that we did we did bring in catalysts to help with the mission control and the Platinum the Catalyst gets plugged up by Led. So we had to go to non leaded gasoline. But all the old cars were still use unleaded gasoline and Europe. They've just starting last few years to start to use catalyst. So they have a lot of old cars using leaded fuels all of South South America lots of Asia uses let it fuels these companies have coined it is like to come he's making tetraethyl lead additives Ethel and Dupont. They made a fortune for the last eleven or twelve years this still coining it. So now Ethel is 28 From to and Zapata is gone from 32 to 78 it so the because the story there was just no story. The story was everybody was drilling for oil like crazy in the early 80s and they were buying Rigs and wound up with too many Rigs and we still have an oversupply rig side. I think this is now starting to turn around but just the fact that gone up was not a good reason to buy it or good reason to sell it avoid long shots. In my lifetime, I bought about 25 companies that if this worked in this worked, you're gonna get these boxcar number earnings are going to run like $843 this year and and the company is going to do seven billion in sales. I bought about 25 long shots in my life. I've never broken even on one of them never never and that's the truth lot of what I'm telling you not tonight isn't true. That's true. I've never broken even on a long shot it I've had stocks I've had stocks go up 10 15 fold. They were surprised. I bought a good company. Come and kept doing. Well. I looked back seven eight nine years later and I found out I made 12 14 fold was a total shock. Said absolute surprise didn't expect to make that kind of money but a long shots. It never happened. Something always goes wrong. I don't know why it always goes wrong. And now if you hear a long shot, I think what you ought to do is you probably ought to write it down a piece of paper and put it in a drawer with a symbol and look to see you. You know what it is. It's probably selling it all these trucks usually sell for for shoe sizes. They're selling it eight and a half or eight or seven and a quarter and and but when you hear when these long shots write it down and check it out, you know, maybe six months a year later if it's going to go from seven to four hundred. It's okay to buy it at 21. I mean, you know, that's fine. Tune in a little bit later. You'll normally find there's no quote on it anymore or it's it's now down in children's shoe sizes or it's down in the candy bars prices and it's just doesn't work and the worst of all and there's a lot of people in here in the investment business. I think they'll they know the story. Are what's known in the business is another very technical term that's called whisper stocks. And you'll get a call from someone else. Say hi Peter. How's Carolyn? How are the kids? And how was your trip and I want to talk to you about learning is a very strong. The guards have an awesome day and said well, what are we saying is I can't hear you saying I mean they start whispering. I don't understand why they're Whispering. Yeah, I think it's something to do with the fact that I think it's supposed to connote that there's people all around them is such a hot idea that if anybody else hears it, they'll be all this buying in and you won't have a chance to buy it or is a flip side to it that that it's such a miserable stock at such a scam boilerplate story that that the SEC is overhearing this and they end up in and they'll get a shorter term if they give you know, if they can't hear what they're saying that the They only get three weeks of civic duty instead of two years or something in there. but these whisper stocks never work the guaranteed they'd never work at the importance of management in a company the management is by far the most important thing the single most important thing. But the odds of an outsider being able to determine who is good management who's bad management whether Management's going to do it's almost useless for an outsider to figure that out. I remember company called UNESCO was run by Maxi jarmon and made a very good company out of it. And I don't know if you made it through fifth grade, but he was a very capable hard-working good leader made a good company. He turned the company over to his son Frank German who I think was number one in his class at a good school that I won't tell your name, but it rhymes with RIT and it's located in Massachusetts at the And he made about eight and this person was very smart knew everything. I mean, it just had every answer. I own the stock died. I suffered along with them. He made eight decisions of significance or might have been nine. Everyone was wrong now. I don't know if you've ever done the exercise in math of doing nine things wrong in a row. I'll tell you get to a very big number you start start doing the numbers count up on the way home and you get something like the number of stars in the universe or number of grains of sand in the Sahara the odds of doing something wrong. Ten times in a row their pre there. I think they're one to the you know, one 10 quadrillion and they're big and he did it. So in this is a person that knew everything worked hard long hours. I'm not sure yet a full deck my was missing the fours and sevens are all the picture cards but it's the he's not out here in the audience was I might have the Rhine. I might've been a Frank Smith it the another company the my Reynolds Metals. I used to find a loon Ministry and Reynolds Metals. Remember reading all these Brokers reports and how Reynolds Metals had great Management's in the 50s and they crummy managed in the 60s and then great manager in the 70s and you totally correlated with that whether it was a shortage of aluminum or not a short film and the same family was exactly the same people it was and they said of great management the three years later Terrell management the great management. It was absolutely people look backwards and you don't know if a company's doing well because somebody made some great decisions six or seven years ago. And that's why the company's doing well. Is no way you're going to know from saying oh and people buy these stocks. The reason being is because a great management that is pathetic it so I've always tried to rely on the business. I want to buy a business. That's so good Lorelai in the business. I've herb knows this one of I've said I want to buy a business any fool can run because eventually one will the be flexible people have They're just have so many prejudices. It's you know, there they won't buy companies that have unions. I made a increment of money and Chrysler and Ford and Boeing and I lost them quite a lot of money in Texas are and a few other Airlines and I've made money with unions of lost money with companies unions. I made money and non growth industries. I've made a lot of money in on growth industries, but people, you know, they're just not flexible enough. They are trying to find hot Industries. They'll ask me to see what do you think what you think the fastest growing industry is going to be I say, why are you asking this question? This is not a good question to be asking because you want to buy companies that are non growth industries growth companies and non growth industries are the winners. Shine shine Industries is incredible coming the carpet industry that just killing her by there's been no growth industry for over a decade. No one's no one wakes up in the morning says let's spend $5 million dollars to expand in the carpet industry. It's been a great stock begin to egg makes retreaded truck tires has been a great great great company Crown Cork and Seal is in the closures and cans. I mean people leave in the industry. These have been spectacular stocks and I visited these people and they had their their corporate headquarters. I mean, I was in the Army my furnace in the Army has been they had their headquarters were over a over a can line and they linoleum flooring that look like a they taken out of an old army barracks and but they were Growth Company spent all the money technology. They kept their plants up to date. Everybody else is sort of leaving the industry. So people have all these rules. They they won't they won't buy a company, you know, they won't buy company starts a letter r i mean they have unbelievable rules and and I always think of the the You know when you get those shirts, I always think these these by list that the lot of professional firms they'll have these by lists and then Walmart's just about getting on the by list of some of these firms now because they said was it was only a small company and it was sort of wasn't seasoned yet in and I always think that Silas is when you buy a shirt you get those but a week later you looking to shoot you see of a pill plug you piece of paper and those see inspected by 4 or inspected by a time in the women the audience may not think I don't know if they inspect your shirts, but they inspect ours and they always say the NBA ever see these things. I always think of these people because in fact has anybody ever got a shirt inspected by one. I mean, I've always wondered I mean do they retire these numbers like they do with the great athletes, you know, you know one was an incredible inspector because I've never been under for I mean, it's always expected by 4 or 6. I just don't there. So, I guess those inspectors were just Classics and they but I always think of that when I get the number out of these people that are there buying stocks have approved list of those people that are inspecting the shirts and You know this business is not that hard to make money if you made it through 5th grade math, you can do it in the stock market. You don't need to know any complicated equations that goodness. I never I could not I did not like math. I did not do well in math. And one up on Wall Street, I wrote about this I literally said if you made through 5th grade math, you do all the stock market and a woman Joan Morrissey in a school st. Agnes is school in Arlington, Mass outside of Boston. Read the book and she got she had a seventh-grade class do a whole year in the stock market. They read the book. They covered companies. They had to buy a minimum of four companies that have by at least one company with a dividend yield they researched from they wrote reports on them and the average for their class when they finished it the next two years, I think was up to 90% in the Mark was up 25, they bought companies like tops and they bought baseball cards and they bought Reebok and about Nike and they bought Walt Disney and they bought 9x which is a local telephone utility and they but IBM because they yield and I was buying at the same time. I think the They did very well and people say well that's just kids and it's paper money. It's not real but the decade of the 80s. There was 8,000 investment clubs. These are people of average average folks modest means they meet once a month. They share ideas. They do a little bit of research sixty-two percent of the investment clubs in the 1980s beat the market. In the 1980's only 25% of professionals if you would match the market the 1980s would have been the top quartile of professional investors. So you don't need you don't you don't you can do it? It's it's not that hard at the you just have to be flexible. The that's one of the big mistakes that people make in. And a lot of lot of reasons. I think one of the problems they have is that they don't understand where to start. It's not that hard if a company goes from doing terrible to doing mediocre to doing okay, you can make a lot of money the goes from okay to doing terrific. You can make a lot more money. From then on with a sickle, you know, you lucky to break even but then those first two stages you can make a fortune. And you only need a few triples in your lifetime. You don't need a lot of them. People are realized as a hundred percent correlation between what happens to a company and you can in within the industry you're in the steel industry aluminum industry the paper industry. You'll see coated paper. You'll see pulp turn around. You see these products turn you can make a lot of money on these things. Huge amounts of money people have extremely valuable information. There was this fireman in Western Massachusetts that saw two companies in his County one was Tampax and most Friendly Ice Cream. They both kept expanding the company that kept putting Wings on they kept hiring people he put $1,000 each one of these stocks over three years total of $6,000 and he made a million dollars on a six thousand dollar investment. Now you didn't have one of these create computers from out here or a vax you just you just kept seeing these companies keep hiring the kept doing. Well. He says, you know, there must be there must be something behind these companies. And that's all there is to it. It's not that hard and that's what you have to do. You have to forget about the money supply you have to if you can't figure out the company and I think one thing you have to do is you have to get off this this mode the people in this depression mode psychological depression. I think what you need to do is you have to maybe have to rent an eight-year-old for a weekend or you know, you have to go somewhere see some young kids. They don't know about all these horrible things that are happening and if you get around your peers you mean it's just it's a loser because everybody's always talking about real estate's going down and is and you just get grumpy and it doesn't it doesn't do any good work. So it They're going to be great opportunities as great stocks out there. You're going to find in there are looking for you. I remember I I bought first talk. I bought I owned it myself. And when I took over Magellan fund the I call the trader in the train room has always his great jokes. I remember I mean that they have about eight jokes a day in the trading room at the remember within 10 minutes after a Pope John Paul II was elected. This is a the pope was from Poland. They said the pope has done his first miracle it can this came out of the trade when he's he's made a blind man deaf, you know, I mean, this is I mean, you know, this is 10 minutes that they just announced that they already had a joke sweeping trading rooms all over the United States the the the and and I called up and I said literally I called three stocks in I wanted to buy the first day of Magellan I called in I said one by Taco Bell and they said is that the Mexican Telephone Company? It's a true. Yeah. Yeah, and this is a company is a company 1973 and for went from 14 to 1 they had no debt. They had 250 stores open. Never closed the store. They're just in Southern California's Central California there one other state they're doing great stork stock went from 14 to 1. I didn't find out about it didn't get to do didn't do the research tools back to about 15. I made the light made the largest position my fund and it could bought out by at 42 by Pepsi-Cola if he hadn't got bought out. I think we're going to 400 it. They stole a company it they're smart people Pepsi and This is a great company. Imagine all the people. Imagine if you had worked in the restaurant industry the last 30 years you saw Pizza Hut. You saw Taco Bell, Kentucky Fried Chicken. You saw Bob Evans Farms last few years. It was Chili's Dunkin Donuts Starbucks has just come out. I mean you see these companies yet. When if you Sublime kitchen equipment you supplied McDonald's. McDonald's, I remember people talking about McDonald's having too many restaurants not exaggerate in 1980 by McDonald's 1978. And I remember 1970 there was debate there was too many McDonald's. There's too many restaurants to me hamburger restaurant United States since then McDonald's is open up over one restaurant add a doll is opens over 380 restaurants each year the open over one restaurant a day and they're still doing great and when they are still expanding the base get big, but then they introduced breakfast dangerous drive through half the business now is drive-through. They introduce desserts. They went overseas. Imagine if you'd seen McDonald's. These companies were unbelievable. You could have seen Ponderosa when it was a good company was crowded and then you'd notice it wasn't that hot and the products weren't that terrific. I wish Red Lobster is part of General Mills is a public company when incredible cover Red Lobster has been that the mean if you'd been that business you would have seen at least 15 stocks that went up 10 or 20 fold. And you could see they were crowded you could see how packed they were in the nice thing about a restaurant chain. If you have a terrific restaurant chain in Florida and something comes out with a better Concept in the state of Washington. It doesn't affect you. It doesn't affect you at all might not affect you for 10 or 15 years. Now if you're a manufacturer, you're making a disk drive or a chip or a logic part something comes up with a better product anywhere in the planet within a year. You notice it you notice the orders they can get some kind to contractor to contract out the work. It's a restaurants or retailers. I've had great luck with that group retail. Imagine. If you'd been in a mall the last 25 years. The nice thing about about retailing is if you blindfolded somebody If you blindfold somebody then you put them all in the Twin Cities. We put them all in Atlanta or Boston or San Francisco or Denver. You took off the blindfold. They wouldn't know where they are. I mean, they're all the same. They're exactly the same and if you can make it in a mall in some when someplace you can make it another Mall. Imagine if you were in that business you worked in a mall or your you spent time in a mall. You saw the limited you saw Toys R Us. You saw Melville. You saw an incredible group of companies. Come along Marshalls. T.J.Maxx Toys R Us company after company it you ought to get the dunce cap Award of all time. If you didn't make money you've been in retailing the last 25 years. Did you see these companies? So that's my that's all I'm trying to say is a great stocks out there. Just a little bit of homework. Keep your eyes open. They'll find you. Thank you very much.