{"id":1383,"date":"2010-04-08T09:05:21","date_gmt":"2010-04-08T13:05:21","guid":{"rendered":"http:\/\/www.technologyinvestor.com\/?p=1383"},"modified":"2010-04-08T09:16:25","modified_gmt":"2010-04-08T13:16:25","slug":"bereft-of-new-ideas-the-charm-of-saying-no","status":"publish","type":"post","link":"https:\/\/www.technologyinvestor.com\/?p=1383","title":{"rendered":"Bereft of new ideas. The charm of saying NO."},"content":{"rendered":"

The pile on my desk is smaller. The catalogs are gone. Some of the magazines are gone. \u00a0The bills are paid. The biggest remaining pile is the K1s (pronounce Kay ones). They’re paperwork the IRS requires from your various partnerships \u00a0in real estate, hedge funds, etc.<\/p>\n

All these are reflections of an older \u00a0now bygone, time. When I (and Harvard and Yale) actually thought that private equity funds, real estate syndications, etc. would actually make money. To their credit, some actually have. But if I do the math, and look at the paperwork, the aggravation, and, most horrible of all, the ongoing capital calls, the whole mess is a black hole I’d like to climb out of . Some of the losses have been horrendous.<\/p>\n

The stockmarket and the bond market may have their share of disasters — e.g. the Tech Wreck of 1999-2000. \u00a0But they have one major feature — when in doubt (when things go awry), get out. You can<\/strong> sell from one day to another and go back to cash. No one ever lost money by being in cash. \u00a0( I know the argument about inflation. But it’s bogus. I’d rather lose 3% to inflation than 100% to a stalled, dividend-less, real estate syndication or private equity fund.<\/p>\n

We will all emerge from the last ten years with several sobering lessons:<\/p>\n

1. Cash is king.<\/p>\n

2. Long-term deals rarely work.<\/p>\n

3. Control matters. My best investments remain the ones I made (or helped) make the key decisions.<\/p>\n

4. No management listens to its shareholders, fundholders, syndicate members.<\/p>\n

5. Few people believe in stop losses. My inviolate rule is 15% for stocks. You can apply it to real estate and other assets. But most managers don’t.<\/p>\n

6. If I give my money to others to manage, it’s a rare manager who (a) knows what he’s doing, (b) cares about making me a profit and (c) isn’t in it solely for the management fees.<\/p>\n

7. Learning to say NO may be your most important skill going forward for the next ten years.<\/p>\n

So, this morning, I’m cynical.<\/p>\n

Every new book out there — from Too Big to Fail<\/em> to The Big Short<\/em> — shows Wall Street money managers to be both incompetent and uncaring. Read them and be depressed.<\/p>\n

That’s it for today. It’s 9:00 AM.<\/p>\n

I’ll come roaring back tomorrow. Fortunately, Apple continues to climb.<\/p>\n

\"\"<\/a><\/strong><\/span><\/p>\n

Harry Newton, who played tennis very well yesterday and is proud of that. <\/span><\/span><\/p>\n","protected":false},"excerpt":{"rendered":"

The pile on my desk is smaller. The catalogs are gone. Some of the magazines are gone. \u00a0The bills are paid. The biggest remaining pile is the K1s (pronounce Kay ones). They’re paperwork the IRS requires from your various partnerships \u00a0in real estate, hedge funds, etc. All these are reflections of an older \u00a0now bygone, […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1],"tags":[],"class_list":["post-1383","post","type-post","status-publish","format-standard","hentry","category-uncategorized"],"_links":{"self":[{"href":"https:\/\/www.technologyinvestor.com\/index.php?rest_route=\/wp\/v2\/posts\/1383","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.technologyinvestor.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.technologyinvestor.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.technologyinvestor.com\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.technologyinvestor.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=1383"}],"version-history":[{"count":0,"href":"https:\/\/www.technologyinvestor.com\/index.php?rest_route=\/wp\/v2\/posts\/1383\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.technologyinvestor.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=1383"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.technologyinvestor.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=1383"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.technologyinvestor.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=1383"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}