FOOL ON THE HILL
Advice for Grads

In 1997, Mary Schmich from The Chicago Tribune wrote a mock graduation speech entitled "Wear Sunscreen." Her sage words were transformed into everything from a hit song to a popular e-mail canvassing. Five years later, Rick Munarriz puts a Foolish spin on the popular column. Can you mock a mock column? Young graduates, why the heck not?

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By Rick Aristotle Munarriz (TMF Edible)
June 3, 2002

Ladies and gentle Fools of the 2002 graduating class:

Share stock screens.

If I could offer you only one tip for the future, sharing stock screens would be it. The long-term benefits of enriching your fellow investor through swapping due diligence may not have any scientific basis, but, come on now, do you really think the rest of the advice that I am about to dispense will be any more lucid than that? To be honest, I've always been afraid of squares and between this podium, your pointy caps, and my most uncool demeanor, I don't know how far into this speech I'll get. But, with little choice but to fling caution's slingshot to the wind, let's dance.

Enjoy the power and beauty of compounding interest. Oh, never mind. You're freshly minted graduates with student loans to pay, credit card statements from your last spender bender to carry over, and you're kicking the tires of cars and homes you just can't afford. You'll learn all about the beauty of compounding interest, only from the wrong side -- the ugly side. You spent your whole collegiate career earning course credits but never as a creditor.

But trust me, in 20 years you'll look back at the interest you paid with a lack of disinterest. You will realize that money saved today will linger with the same savage aftertaste of accumulation as the money you squandered along the way. You can dig a ditch or you can build a mountain. I trust that you will take the higher road, now, while your destiny is still within your choice's grasp. Your leverage is not as fat as you imagine. Now.

Worry about the future, but do so only if you can make a difference in the present. The world isn't going to get any easier. It's not going to spin any slower. In every life, a little Enron must fall. Embrace failure like a textbook. Embrace success, too, but strip-search it for destructive weapons before you let it go upstairs.

Do one thing every day that challenges you.

Think.

Don't be reckless with other people's money. Don't put up with people who are reckless with yours.

Wear a jester's cap.

Perfection is overrated. Aspiration is underrated. There will be dark days in which your problems may appear insurmountable. There will be glorious times in which you may appear to be invincible. In both cases, four words of market wisdom will save your life: Buy low. Sell high.

Don't just balance your checkbook -- conquer it. Don't just live beneath your means -- pitch a tent and stay there.

Buy pants. Sell short. Avoid penny stocks -- you're worth more than that.

Never stop learning, especially when you start teaching. Absorb everything but retain only that which makes you smarter. If you think you know it all, that's proof that you don't.

The world is your oyster. Work hard enough to afford a professional pearl diver.

The life process is poetic: Yearn. Learn. Turn. Earn. Urn.

Remember the anecdote about the Fool who told you to remember the anecdote. Forget to attribute this graduation speech to its rightful author. My apologies in advance to Kurt Vonnegut.

Spend more time on choosing your investment vehicles over your mechanical ones. Done right, they will give you the better mileage.

Appreciate capital appreciation, but never depreciate depreciation. In any portfolio, there is more to learn from your losers than your winners -- just as you can learn more about yourself from the date who dumped you than the one who never told you no.

Keep your old brokerage statements. Throw away your old financial magazines.

Smile. Teeth aren't forever.

Fall in love with investing, not your investments. Contrary to conventional wisdom, a penny saved is not a penny earned. At least that's my two cents worth on the matter.

Relish the ten-bagger but never gloat about it. You just never know when the bucket of eggs will be dangling perilously over your head. Suffer through the losses but never dwell on them. Sometimes you can't hear opportunity knocking over the sound of your own whining.

Save, even if it is pocket change.

Invest, even if it is the pocket change you almost talked yourself out of saving.

Own more than you owe. Inhale more than you exhale.

Maybe you'll be rich, maybe you won't. Maybe you'll earn it, maybe you won't. Maybe you'll realize your potential as an investor on your 75th wedding anniversary, when you begin to take stock of all the hefty mutual funds loads and high full-service commissions you paid out over the years. So save yourself today. Birthday cakes just aren't as tasty as they were the year before.

When someone you care about asks to be held, hold them. When an analyst downgrades a stock to "Hold," don't. As long as you're buying, you will always be called "attractive" and the same goes for the unpleasant relationship between a company and its potential underwriter.

Do not watch the ticker tape. It will only make you feel poor.

Thank your parents. If they are no longer living, thank someone else's parents -- odds are their own children are ungrateful.

Accept certain inalienable truths: Money feels good. Philanthropy feels better. Paper gains on a four-bagger feels good. Cashing out on a three-bagger feels better.

Don't mess too much with your portfolio or, by the time you're ready to retire, it will have beat you to it.

Never take financial advice from someone who stands to profit from its contents and any actionable results stemming from it. Pay for personal enrichment, not for the sole enrichment of others. Stock tips are like noses. Everyone's got them and, sometimes, they smell.

It's a brave new world out there, even for an old coward like me. Diplomas will become stock certificates. Tassels will become bookmarks. You will become me, unfortunately.

But trust me on the stock screens.

Rick Aristotle Munarriz is a proud graduate of the University of Miami. Go Canes! Rick's stock holdings can be viewed online, as can the Fool's disclosure policy.