The Money Man Behind Rick Santorum: Who Is Foster S. Friess?
Savings Experiment: Snow Removal
A lot of readers have been thinking similar thoughts to someone who commented on my recent post: Chasing Value: Watch BNI -- the heck with Citigroup.- Donald wrote, "Why the hell would I take advice from a company, that as a whole, its Net income was US$ −27.684 billion for 2008.
I happen to take exception to the particular analysts position in my story, and I find that most of the time analysts are either late or lost, but this does not mean there is nothing to learn and that all analysts are worthless. Often being an analyst is a set up for failure based on how the process works. Even some analysts at banks that have lost billions may have valuable insight on occasion.
"My pal Warren" lost billions last year, and I lost a few bucks myself, but I have not lost confidence in his judgment or my own.
A friend, David R., a financial adviser at a local Merrill Lynch office in Los Angeles and I, get into debates all the time about various market issues. I have not placed any money with him because I manage everything myself, however, he is knowledgeable and sincere and I think on the whole does well by his clients. Merrill Lynch, now a part of Bank of America (NYSE: BAC) has also lost many billions of dollars.
Over the past few years since Cramer has been doing his Mad Money show my opinion of his advice has diminished, but I learn from him too. You can learn from anybody. I have certainly learned a lot from our readers over the years.
After I wrote the story I started to wonder if analysts working for investment houses that have been crushed by the economic firestorm have become at all self conscience when they voice an opinion, knowing how the public has shown ever increasing disdain. I suppose some do and some don't.
It would be great if any analysts that might see this post would weigh in. Perhaps they might if readers forwarded this post to their own advisers.
Sheldon Liber is the CEO of a small private investment company and the principal for design and research at an architecture & planning firm. He writes the columns Chasing Value and Serious Money. Disclosure: I own options in Citigroup (naked puts).
Goldman Earnings Sink After Buffett Dividend
Johnson & Johnson's Income Falls 23%
Burberry Shares Leap on Sales Update
Reader Comments (Page 1 of 1)
4-29-2009 @ 7:28PM
william lindblad said...
Many years ago a small time oil dealer, like in the kind that pumps oil into residential tanks, decided he wanted to do more. He hired a prestigious lawyer and eventually became a market listed company on the old American exchange. I was watching and although not a direct party, had confidence in his actions. I had a relative, an account exec. with Merrill Lynch whom I approached with my feelings and an intent to buy into said company. I was advised it would have been a bad move. He should have known and I went with the advice. This was the 1960's and he was making a 1/4 mill and I, about 8 g's. I had 1 g to invest and the stock was around 3.88.
The company is still around today and bears it's founder's last name. First was Leon, second was Hess.
Just because you are supposed to know does not mean that you do. The lesson here is that reliance on others is required, but total reliance is foolhardy.
Why worry about analysts? Ponder this? We are a Constitutional Representative Republic. Since technology has now brought us to the second age of Solon, communication is now at light speed, and a true Republic is at hand, the need of representatives is quickly becoming dated. In short, Congress, in it's present form and function, is an anachronism.
4-29-2009 @ 9:12PM
clikdawg said...
Mr. Liber --
Why not re-read this piece, now you've had your dinner -- it is the very definition of "whistling past the graveyard".
Mr. Lindblad --
You nailed it.
5-07-2009 @ 4:33AM
Flora said...
"It would be great if any analysts that might see this post would weigh in. Perhaps they might if readers forwarded this post to their own advisers Nice article.
5-07-2009 @ 11:32PM
Compton said...
Why worry about analysts? Ponder this? We are a Constitutional Representative Republic. http://www.vxcb.com Thanks