Financial geniuses are exceedingly rare, and by definition, proven to be so, usually in the past tense, when it doesn’t really matter any more.
A Random Walk Down Wall Street by Burton Malkiel should be a required read for anyone putting their faith in a single investment guru.
Funny, but Enron’s Skilling always bragged about their “perfect hedge” also. Perfect, because --- you see Enron had all these “smart people” running the “Risk Management Group”. And this RMG just never F&%^ed up!
Glad Ben’s still got it! After reading some of the comments to his articles, I was worried he’d gotten too rich and soft.
had to say it....
I once had the majority share-holder/owner of a publicly traded company tell me to buy his stock, because certain, specific things would happen and it would go up.
The comments were made at a small, informal dinner of a mutual friend, who was quite close to this CEO. So, I decided to “invest” a few thousand bucks.
The stock proceeded to lose 50% of its value over the next 6 months. I dumped it and eventually the company fell on hard times and was bought by another company for pennies on the dollar.
The moral of the story? Don’t even trust “inside” information.
This is why it's hard to be sympathetic towards the Madoff victims. Even the most rudimentary kind of diligence would have informed these people that there is no financial magic bullet.
It's like betting on both Black and Red at Roulette. But in both cases you will lose money, because there is a fee for buying options, and there is a green 0 and 00 on the Roulette wheel.
Investment tip #1: Never get involved in any kind of transaction that begins with someone saying “Psssst!! Buddy!”.
Good think Madoff didn’t “Win Ben Stein’s Money”
It's all grace, Ben. Amazing Grace.
Losing and making money are not moral issues so long as you are being honest.
Ben Stein's a good and wise man. He adds needed perspective.
they were kinda right, I’ll bet Madoff never lost HIS OWN money.
The best investment for my money right now is securing the matching funds from my company and dumping the rest into my Navy Federal Savings account at 3% interest.
NFCU is run by ELECTED ex Admirals and Captains. They are tight as hell in loaning out money and play it straight.
They even cancelled a $500 credit card on my for making two late payments in a year. (note: payments did not exceed 30 days.)
Tough crowd!
Puhleese. From about 45 seconds after the inception of the term, it was understood to be term of art. Nobody expected "hedge funds" to be perfectly hedged -- there'd be no point.
And, hey, why don't you name names? Who was the investment bank that fed you that line of crap? 'Cause they're accomplices. Nobody pitches something that hard unless there's plenty of chop.
At least Stein is honest. And I can honestly also say that I have “inventive” ways to lose money in the stock market. Unfortunately that seems to be the way one learns to stop losing money. I dumped five losers the other day when I should have dumped them years ago. And they still are losing money. Cramer had some good suggestions today and you might still be able to catch his program where he discusses those 25 rules of investing.