Beginning around 2002 or so, Microsoft founder Bill Gates began to systematically liquidate his immense Microsoft fortune, selling as much Microsoft stock as he could each day without having a material impact on the stock price of the company that he founded. The proceeds of Gates’ stock sales poured into his investment holding vehicle, Cascade Investment Holdings, LLC, that has long been managed by Michael Larson.
Although Larson is believed to exercise considerable autonomy over the investment selections, I pay close attention to the investments that show Bill Gates’ thumbprints.
One such investment was Republic Services (RSG), the waste collection company, which Cascade purchased during the Great Depression for a price of under $20 per share. Larson gobbled up Republic Services stock like it was a tray full of Skittles, at one point giving Gates’ holding company a one-third stake in the entire business.
Why the trash industry? What did … Read the rest of this article!
An interesting phenomenon in the United States is that, outside of those living in true poverty, nearly all other individuals self-identify as a member of the middle class. Teacher earning $3,500 per month as part of a Teach For America or related program immediately after graduation? That person identifies as a member of the middle class. Pulling down six-figures annually as mid-level investment banker? Identifies as a member of the middle-class.
Small business owner who earns $75,000 per year? Rightly identifies as a member of the middle class. Small business owner who grows that business to earn $300,000 per year? This person now identifies as a member of the middle class who happened to have a successful year.
That is significant.
Why don’t individuals classify themselves according to their economic reality of their earnings? If you are bringing in $15,00 per year, you are not middle-class, … Read the rest of this article!
Milton Freidman observed that Americans usually self-describe as individualists but it would be more accurate to describe Americans as a family-oriented culture. He pointed to the self-sacrifice that parents often make on behalf of children, which would not make sense unless you valued your children more than yourself.
“You know, the thing that is amazing, that people don’t really recognize, is the extent to which the market system has in fact encouraged people and enabled people to work hard and sacrifice in what I must confess I often regard as an irrational way, for the benefit of their children. One of the most curious things to me, in observation, is that almost all people value the utility which their children will get from consumption higher than they value their own. Here are parents, who have every reason to expect that their children will have a higher income than they ever … Read the rest of this article!
In the February 1, 1990 edition of “Advertising Age”, the advertising magazine collected answers to a 1982-1989 Gallup that asked customers for the most memorable ads that they had encountered over the previous month. Coca-Cola came in the #1 spot with 3,700 remembrances, followed by Pepsi in the $2 spot with a little over 3,000 remembrances.
At the time, Pepsi was winning the cola war, with its eponymous brand accounting for almost 20% of the overall beverage market (at the time, Coca-Cola accounted for 16% of the market).
Over the past three decades, however, it is absolutely stunning how much Pepsi has ceded ground to Coca-Cola in the sale of its signature brand.
Between 1990 and 2018, Coca-Cola cumulatively spent almost four times as much on advertising as Pepsi spent advertising on behalf of the Pepsi brand. As a result, Coca-Cola has largely retained its dominant market share (with 15.3% … Read the rest of this article!