It Was a Very Good Year

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December 30, 2005

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"When I was 74, it was a very good year..."

Indeed, 2005 was a very good year for me. Here I am, a modestly talented geezer with more cash and net worth than at any prior time in my life. With a pension, social security, stock dividends, fees from an occasional consulting gig, rental income from my cottage on Cape Cod (school teachers are perfect tenants during the off-season), a more than 100% return on my AAPL investment, and a minimum of 12% appreciation on two homes, my cup runneth over. Plus, George Bush keeps cutting my taxes. Is this a great country or what? Who says that growing old is a drag?

The one blemish on my money management record this year was GM. I never expected the world's largest industrial company to take a header. Maybe I should have listened to Mish and Rodger and shorted GM. But that would have turned me into a pessimist, a naysayer, a "Chicken Little." That's not me. When and if this market heads south in a big way I'll be on the sidelines with my cash in government bonds. If life has taught me anything it is to be hopeful and patient. Once you lose hope and become a sour apple you might as well pack it in.

I hope 2005 was a good year for you, too. Like you, I wonder what 2006 will bring. I don't know any more than the next guy but I remain hopeful. AAPL may not hit another home run in 2006 but I believe the stock has the potential for more growth, maybe as much as 50%. I'll settle for that. I also believe that housing will continue to appreciate albeit at a slower rate, perhaps as little as 3%-5%. I'll settle for that, too. It's the leverage that makes real estate a can't-be-beat investment over time. Lastly, I plan to take a flyer on a stock I've been following for a while now; VRSN. If you believe that the Internet is changing the way the world does business, VRSN may be worth your time...and money.

Happy New Year...and good investing in 2006.


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