There were always two contradictory ideas I had to carry around in my head when I first started to study investing: (1) bank stocks have a tendency to blow up every generation or two, completely wiping out shareholder equity, and (2) Wells Fargo always found a way to survive these blow-ups and deliver exceptional returns. What’s the magic that seems to make Wells Fargo the superior bank stock investment for those that want to build sizable generational wealth?
You can look at just about any long-term period and the results are staggering. Bought Wells Fargo in 1972, on the eve of a 75% banking sector crisis? You compounded at a rate of 13.5% through the present day and needed to only put $4,000 into Wells Fargo stock to own a million dollars worth of it today. Bought it in 1981? The compounding rate of Wells Fargo stock was 14.7% annually, … Read the rest of this article!
For the second podcast, I have prepared a thirteen step overview of settling an estate in case you ever get asked to be someone’s executor of estate (or, if your prefer the modern term, personal representative). The probate process is a creature of state law that is mostly governed by each state’s statute, so it’s not an exaggeration to say that every state is different–the steps of administering an estate in California will have way different requirements than Texas. Still, there are general steps that are generally followed in all states, and I provided a twenty minute overview of what the process entails if you’re interested in getting the lay of the land for administering someone’s estate.
I’m excited about launching these new podcasts through Youtube because it gives me a chance to cover a lot of topics that I probably wouldn’t get to if I stuck with the written … Read the rest of this article!
I created a Youtube channel titled “The Conservative Income Investor” to post short videos that will supplement the written content for the site.
For the inaugural edition, I discuss how the duty of the investor is to find the best risk-adjusted investment opportunity that is presently available to you, even if the stock you are analyzing previously traded at a more attractive entry point.
I use Nike as an example. Between 2005 and 2007, the valuation of Nike stock climbed from 15-16x earnings to 23x earnings. A lot of people probably stayed away from the stock on valuation concerns. And yet, even if you purchased a block of Nike stock on the eve of the recession at the absolute highest price in 2007, you still went on to compound at a nearly 16% annual rate.
The primary question should be: What is the most attractive investment … Read the rest of this article!
It was really fun for me to cover General Electric (GE) stock from the time I started finance writing in 2011 through 2014. Why? Because the price of the stock was in the mid teens, high teens, and low twenties. It was very easy to cover a business that was reporting high single digit earnings growth coming out of the recession and was in the process of ramping up its dividend that got reduced to $0.20 during the 2008-2009 financial crisis. The recovery was happening right in front of investor’s eyes but a lot of people stayed away because GE’s first dividend cut since The Great Depression was the predominant factor on most people’s minds.
But as the earnings and dividends have climbed, and the 2009 cut has become a more distant memory, investors have been more willing to appraise General Electric as it is rather than as it was. … Read the rest of this article!
“Many of us never realize our greatness because we become sidetracked by secondary activity. We spread ourselves too thin–don’t know how to say no, and we find ourselves doing all kinds of things and never ever have time to do those things we have to do to work on ourselves. And then there goes a second. There goes another second. And another second. And we can’t stop and hold time. And boom, there goes another second–and before you know it, you wake up one day and you’re behind on your dreams.”
Les Brown is one of my all-time favorite motivational speakers, and I highly recommend that you watch this energetic speech on: (1) standing up to yourself to make a deliberate effort to narrow the gap between who you are and what you can be; (2) improving the internal monologue that you carry with you throughout the day; and (3) … Read the rest of this article!