From Blessed to Fail to Doomed to Succeed

William Smead
Chief Executive Officer
Chief Investment Officer





Dear Clients and Prospective Clients:

 
Today, an owner of good quality United States based common stocks is doomed to succeed over the next ten years. They are doomed because of this psychologically difficult environment’s affect on stock prices. Stocks are low. Prices compared to earnings are low. Yesterday there were 1978 New York Stock Exchange listed stocks that made a 52-week low. A big number for a single trading day over the last ten years was 600. We are lonely optimists. Jim Cramer, who has been pushing momentum stocks on T.V. for years, is telling people to sell the very same stocks he touted a year ago. Buy low, own low and hold a long time has always succeeded in the past.

We believe we will succeed over the next ten years because the quality and financial strength of our companies leads them to survival and survival leads to prosperity. The number one damager of long-term profitability is competition. How many new drug companies are being funded by the IPO’s of Common Stock? How many phone and cable companies? How many brand-name retailers are appearing on the seen? How many new asset custodians and money managers? How many software or technology consulting firms are debuting? The answer is nearly zero and in fact the opposite is happening! Our companies are seeing their competitors decline or disappear in direct industry competition and investment alternatives are dropping like flies. How about those hot commodities and commodity-related stocks? How about those emerging international stock markets? How about those glamour tech stocks?

Is the population of the world shrinking? In the U.S. we are delivering the most babies (4.3 million last year) since the height of the baby boom in 1957. China and India should create massive new markets for pharmaceuticals, entertainment, software, consulting and money management/custodianship. More customers and fewer competitors, sounds like a dream come true.

History is on our side! U.S. investors were doomed to succeed in 1932, 1942, 1974, 1982 and 1990. They were blessed to fail in 1929, 1966 and 1999.

We have no idea when this panic hits bottom. However, if you can survive this, we believe you are doomed to succeed!

Warmest regards,

William Smead

 

We Advise Investors

Sign up to get our advice sent straight to your inbox.

Recent Missives

Presidential Stock Market Euphoria

November 19, 2024

How does the euphoria for stocks in the days after the 1980 election contrast with today’s Trump election euphoria? What were the fundamentals of the 1980 stock market compared to today’s fundamentals? What...

⟶ Keep Reading

CNBC: Cole Smead, CFA on the Oil Market’s Future

November 7, 2024

More Iran sanctions and ‘drill baby, drill’: Oil market’s future is still uncertain under Trump By Natasha Turak For more information go to www.cnbc.com. The information contained in this article […]

⟶ Keep Reading

Yahoo Finance: Cole Smead, CFA on Investing like Buffett

November 6, 2024

  How to invest like Buffett: Grow your circle of competence  For more information go to finance.yahoo.com. Stocks mentioned: BRK, BAC, OXY The information contained in this tv appearance represents […]

⟶ Keep Reading

The Pictures Say It All

November 5, 2024

Dow Jones (publisher of "The Wall Street Journal") announced that Nvidia (NVDA) will replace Intel (INTC) in the Dow Jones Industrial Average. Intel was brought in to replace Union Carbide four months and...

⟶ Keep Reading

Barron’s: Bill and Cole Smead on Where the Stock Market Is Headed Next

October 26, 2024

Where the Stock Market Is Headed Next, According to Our Exclusive Investor Survey By Paul R. La Monica For more information go to www.barrons.com. The information contained in this article […]

⟶ Keep Reading

Inflation Mathematics

October 22, 2024

Two major labor unions, the Dock Workers Union and the Boeing Machinists Union, have attempted to reach an agreement with their employers on a contract. The dock workers agreement proposes an average 8.5%...

⟶ Keep Reading

We Advise Investors

Sign up to get our advice sent straight to your inbox.

US INVESTORS

Individual Investors

OR

Financial Advisors, Family Offices,
and Institutional Investors

OR

NON-US INVESTORS

Individual Investors

OR

Financial Advisors, Family Offices,
and Institutional Investors

OR

Scroll to Top