Andy Kessler (author)
Author of books on business, investing and technology.
Cheap power helped create a new market that didn't exist previously.
When someone pukes up a stock, it's not hard to miss. Mispriced securities all over the table. And we are there with a barf bag, collecting all we can.
But someone knew and made a killing. It was investing when you know something no one else knows.
Our portfolio was more of a Roach Motel-stocks came in and never left. This was exciting.
The stock market teaches you the hard way - it's all in the margin.
You can't ever forget how precarious and humbling running money really is.
Economists may insist we are running a trade deficit, but in reality, we are running a margin surplus.
But I was confused. Here we were scrambling around looking under rocks for great long-term investments, and every other hedge fund, or so it seemed, was doing some funny hedge of cheap yen money and T-bills. That's investing?
A product lowers the cost of doing something and eventually, customers will figure this out and buy the stuff in big volume, but they're not going to buy yet. You've got to have real conviction to step up and own this kind of company-you're staring over the edge of the waterfall, not sure when the growth is going to start.
Give me a big enough sandbox to play in, and I'll find the part of it not being used as kitty litter.
In fact, maybe Metcalfe's Law is the formula for Doug Engelbart's scaling of human knowledge, just as Watt's steam engine scaled human power.
"The stock of the greatest company in the world is crap if every investor already thinks it is the greatest company in the world."
It was what I didn't know about that always seemed more interesting.
By the way, I love paradoxes.They usually mean someone doesn't understand what's really going on and you can invest in things other people "can't know." I start salivating when I hear that word paradox.
I think what I learned is that wealth comes not just from taking risk but from constantly taking risks.
But the stock market is not 1:1-it is not a zero sum game. So those deaf,dumb and blind economists can't find the capital flows.
Wealth really is a never-ending process. So is running money. You can't just walk away and ask about the meaning of life.
You invest in companies with great long-term prospects.
"I've been doing this for years. Never invest in a company with the target price for the stock in the name of the company."
When you think long-term, the edge is really investing because others can't know.