Man, I'm stoked! Know why? I just watched Maria Bartiromo slap around one of those monster screamers on CNBC.
I just had to pile on with this: "You go, girl!" It's about time somebody stood up to one of these Chicken Littles.
Yes, the market may crash!
Heck, it may have crashed before you read this. But I don't care. Honestly, what do we care if investors open the floodgates this afternoon? Think I've lost my marbles? Well, let me explain ...
I graduated with a degree in finance in May 1987. (My mother still can't believe it.) A few months later, the stock market up and "crashed." I was a long-term bull then, and I've been one ever since. But back to graduation ...
Whether it was to divert attention from her shock that I'd passed, or to better express it, I'll never know. But the day I chucked "Modern Portfolio Theory" for good, my mother handed me a rectangular plastic case with a worn black rubber handle.
Of course, I had to open it!
So what was in it? Read on and I'll tell you. For now, just know that had I sold it instead of keeping it, I could have invested the money in Apple (Nasdaq: AAPL). I'd have more than a hundred shares right now worth almost $18,000. You know where this is going, right? If I'd bought Texas Instruments (NYSE: TXN), I'd have more than $8 grand.
I'd look a bit more human buying beleaguered Merck (NYSE: MRK), though I'd still be sitting on about $6,000. But if I'd bought Applied Materials (Nasdaq: AMAT) instead? I could hire Paul Reed Smith to clean out my garage -- and while he's at it, handcraft me a brand new present from Hope diamonds and dinosaur bones.
OK. Those are some outrageous examples. So, let's dial it back a bit. What if I'd bought IBM (NYSE: IBM)? Hardly took a genius to buy Big Blue in 1987, right? Well, now I'd have nearly $3,000. Or how about old-school Wal-Mart (NYSE: WMT) or even older-school General Electric (NYSE: GE)? I'd still be loving life.
Still too good to be true?
Boy, tough crowd. Let's just assume I sold my new toy and dumped the money into a plain-vanilla S&P 500 index fund, then went to grad school to "learn" to write poems and watch Denis Johnson not drink. I'd still be up a downright decent 363%. Of course, that's my whole point.
And that's why I work here at The Motley Fool. And why those Chicken Littles on TV drive me nuts. They cost you money. That's also why I was thrilled to help out David and Tom Gardner back when they launched their Motley Fool Stock Advisor newsletter back in 2002 -- right in the teeth of a bear market.
After all, Stock Advisor is not just about helping investors like us find stocks that beat the market. It encourages us to stay in the market and harness the power of this unstoppable long-term wealth-building machine. Through good times and bad -- no matter how scary the future looks day to day.
Give me date ... a date!
That's what I think Ms. Bartiromo should say to the next Chicken Little who enters CNBC. "Give me a date." Remember, I graduated college back in 1987. What you might not remember is that the decade in which we "borrowed a trillion dollars and threw ourselves a party" wasn't the 2000s -- it was the 1980s.
The 1970s -- now that was the decade we "amassed the crippling debt that was going to bring us to our knees." Sound familiar? So please, perma-bears: Next time you get on TV saying "the sky is falling," "we're breaking beneath the yoke of debt," or "the U.S. economy is headed for years of contraction if not outright depression" ... give me a date!
As for you, fellow investor, take these dire predictions with a grain of salt. And if you're in your prime savings and investing years, promise me you'll stay invested and keep on investing. The market will go down. We will have another credit crunch, another recession. But that was true when I was a boy back in 1979 -- and here we are again.
So what the heck was in the box?
Earlier, I mentioned David and Tom Gardner. I can't speak for their precise beliefs, but I assure you they're long-term bulls on America and its markets. And according to watchdog Hulbert Financial Digest, they're having no problem digging up great companies that make folks like us a lot of money.
To the tune of 18.4% annualized, according to Hulbert. If you want to see why their recommendations are up an average 53%, better than three times what you could get holding the S&P 500, consider this: Try Stock Advisor on me. You can take a full month to decide if you like what you see.
Of course, nobody can guarantee that David and Tom will keep up this torrid pace forever, but it's their sworn mission to beat the market year after year. Having watched them for years, my money's on them. Plus, since you don't have to pay, you've got nothing to lose but your fear. To find out more about this special Stock Advisor free trial, click here.
This article was first published July 13, 2007. It has been updated.
Paul Elliott
opened the box. It wasn't a Paul Reed Smith. It was a mid-'80s Fender Stratocaster. Made in the U.S. of A. Paul still owns the Strat, but he doesn't own any companies mentioned in this article. Wal-Mart is a Motley Fool Inside Value recommendation. Apple is a Stock Advisor selection. You can view the entire Stock Advisor scorecard immediately with your free trial. The Motley Fool is investors writing for investors.
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