The Week in Review -- April 30, 1999

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  4/23 Close 4/30 Close Change %Change
DJIA 10,689.67 10,789.04 +99.37 +0.93
S&P 500 1,356.80 1,335.18 -21.62 -1.59
Nasdaq 2,590.30 2,542.86 -47.44 -1.83

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From Wade to Warren
by Jerry Thomas (tmfcheeze@aol.com)

Greetings, Fools.

Pity poor Yi-Hsin Chang. Well known to Fools as our own TMF Puck, she ought to be spending time in some kind of investing decompression chamber. Last week I mentioned her harrowing tale of survival, braving the treacherous crannies of a Wade Cook seminar. This weekend she treks upstream to Omaha for the annual Berkshire Hathaway (NYSE: BRK.A) shareholders meeting. She'll be reporting in starting Monday morning of next week. The leap from Wade Cook to Warren Buffet, from Death Valley to Mount Everest, from Darth Vader to Yoda, could be too much for you, Yi-Hsin. The human body was not designed to survive such extremes, and we are concerned for your safety. The G-forces you can expect to suffer in making the shift could tear you to pieces, so be careful, kiddo.

Fools who read this week's special Fool series on Warren Buffett and Berkshire Hathaway in light of last week's featured expos� on Mr. Cook can make their own Goofus and Gallant comparison. Warren, sporting his halo, spends his days studying company fundamentals, balance sheets, and annual reports. Wade, on the other hand, seems little concerned with any of the pertinent facts of a stock under his consideration save for its current price and its ticker symbol. Warren buys and holds stocks for the extremely long term, advising those who study his methods that the best time to sell an investment is "never." Wade, the former cab driver, advocates what he calls "meter drop" investing, moving in and out of stock positions as quickly as possible. Sometimes Wade avoids stocks altogether, instead day-trading the volatile derivatives of those stock issues.

Warren is revered as perhaps the greatest pure investor in the history of the sport. Wade is dogged by persistent government investigation. Perhaps most telling, "A" shares in Warren's Berkshire Hathaway, Incorporated, sell for approximately $78,000, while shares in Wade Cook Financial (OTCBB: WADE), last time I checked, are trading for about 47 cents apiece. Fools may draw whatever conclusions they wish from the juxtaposition of those numbers.

You can continue this sort of comparison by clicking into last Monday's Foolish Workshop Report. In it, Fool Jim Stevens examines how Wade's methods stand up to the Workshop's thoroughly backtested stock screening techniques. Enlightenment should be expected, though each reader is asked to bring his own ten foot pole.

Shall we talk about Fools in high places? Recently TMF co-founder David Gardner attended his first meeting as a member of the NYSE's Individual Investor Advisory Committee. As an individual investor myself, it is heartening to see David in this new role. Fools rush in, goes the proverb, and Wall Street is a realm where too few angels have trod. Consider the hush, the gasp of surprise, at David's happy audacity in this meeting to suggest that the S.E.C.'s 60-year-old regulations barring the selective disclosure of material stock information should actually be enforced. It's a thought that pleases this Fool considerably, and you can read David's account of his adventures in Tuesday's Rule Breaker report.

This is an excellent weekend for stock research at The Motley Fool, since so much great fresh material has been posted on our site of late. You will want to spend some time reading the suggestions made by a whole slew of Fools in our annual Stocks for Mom feature. In it, you will find, among others, Warren Gump's (TMF Gump) discussion of IHOP (Nasdaq: IHOP), Brian Graney's (TMF Panic) examination of Maytag Corp. (NYSE: MYG), and David Forrest's (TMF Bogey) examination of Metromedia Fiber Network (Nasdaq: MFNX).

Many of the stocks in this annual Mother's Day feature are well known names you perhaps have overlooked, while others are new names that you will discover for the first time. Hey, why not play amateur psychoanalyst as you read? Ask "When I mention your mother, what is the first stock that comes to your mind? Hmmm?" You could find a great stock idea even while you find new insight into the psyches of each member of our Fool staff.

I'm almost out of space, so let me quickly mention a couple of other resources for you to look at, right now, while you have the time. On Wednesday, Jeff Fischer (TMF Jeff) gave us a great study of Coca-Cola (NYSE: KO) in that day's Drip Portfolio Report. Coke, of course, is a long-term Warren Buffett holding, so if you have an interest in a further study of the sort of company that has helped to move Mr. Buffett's reputation to the lofty position it now holds, this is a good place to start. Also, Phil Weiss (TMF Grape) gives us a great study of Cisco Systems (Nasdaq: CSCO) in a big two-part Rule Maker Portfolio series on Wednesday and Thursday. Do spend some time with it -- you'll learn much about what has made this company the success it has proven to be.

Until next week,
Fool on!

Cheeze

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