How important is it that today’s investor recognize the difference between “easy” money and “smart” money?
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So, I was down in Florida. I was giving a presentation to some high net worth individuals, and of course, after presentations I open it up to questions, which I love. I usually can handle questions pretty well, but I got one that kind of took me back. It wasn't really a question. The guy kind of stood up and he said, "You're no fun!" and I thought for a minute, he didn't say it in a mean way so I guess I wasn't too upset, but I thought for a minute and I did have a quick answer but then I realized... "You're right... I'm not," because what they're looking for are fun investments like the stock market has been for a few decades now. You just throw darts at the board and you're up. In fact, from 2000 to very recently, DOW was up almost 1800%. Bonds have been a great deal. They basically have been up, up, up, up. Real Estate, well you know... you could sit back and drink beer and a glass of wine and you watch the real estate go up. Never have to lift a hand painting it or anything. That's "easy" money. That's what we all like. I understand it. I'd like "easy" money today, "easy" money tomorrow, "easy" money forever, but that's not what real investing is.
Real investing is hard; it's not much fun. It's investments that are not liked by everybody else, because it almost makes sense. If everybody likes and investment and everybody is jumping into it, you're probably not going to have outsized profits or you're in a bubble. Real investing that built this country, Real investing that works, is when you go to do something that people don't do, it's out of favor, may take some losses, might look like the Empire State Building. You know, you build that... you start it when the economy was booming, at least you got the idea, then of course you open it in the depression, it lost money, terrible time, difficult, but in the end it was a very good investment. Gold is like that. Gold actually has had a very good history. I mean, gold is still crushing stocks right now--gold and silver. Those precious metals are crushing stocks since 2000. They've done very well, but they've been difficult recently. They've gone down. People have put more money into them and have seen it gone done further, but in the end...that investment will do what a really good investment should do long-term--make you money. It's a hard investment. It's a "No Fun" investment, but ultimately those investments that really pay off.