Posts tagged fim group
The 4th Industrial Revolution

It’s interesting how our world works. On the one hand, we admire success, yet on the other we often dismiss it. For example, many thought Jeff Bezos’s Amazon would be just another book retailer. Now, he and his company are considered revolutionary and an enormous success. However, as Einstein once said, “It’s all relative!” And Aristotle was known to start his arguments by stating “Let’s define the definitions!”

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Respecting the Three C’s

Over my career, I’ve spoken and written quite a bit on the topics of complexity, connectedness, and change. Respect for these “three C’s” is something that our team at FIM Group regularly discusses as we analyze investments and manage portfolios. I recently circulated a report published by the World Economic Forum (WEF) in Davos, Switzerland, that includes Figure 1, showing major trends and five categories of risks (economic, environmental, societal, geopolitical, and technological) facing the global economy today.

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Current Observations

Happy New Year! I often get philosophical and reflective at the end of the year. I think about the past and reflect on the beautiful people I have known and those who are still in my life. I often miss and am saddened by memories of friends and family members who have lost their lives at relatively young ages. I also feel grateful to be alive in these exciting times. Each day seems to evolve and feel like a sort of “stay tuned for what’s next” drama.

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Finding Niches, Avoiding Valeants

FIM Group has long taken pride in our independent views. While we don’t necessarily set out to be contrarian, the nature of our value-focused investing often leaves us standing apart from the herd. This month we’d like to share some perspective about why we aim to avoid the herding instinct and how we go about keeping our thinking sharp and unbiased.

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Stein's Law

Herbert Stein, Chairman of the Council of Economic Advisers under the Nixon and Ford administrations, came up with a principle many years ago that has guided me over several decades of professional investing. Stein’s Law, as it is now known, is simply this: “If something cannot go on forever, it will stop.” In other words, unsustainable trends are unsustainable. 

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A Few Predictions for the New Year (and Beyond)

Now that we are a couple weeks into the New Year, most economists, market strategists, bloggers and other prognosticators have already pushed the send buttons on their annual forecasts for stock market levels, interest rates, foreign exchange rates and the like. Most will be off the mark come year-end, but that never seems to stop them from gazing into their crystal balls and letting the world know what they see. 

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Optical Discomfort

Investing with a thoughtful, proactive, transparent process, as we do here at FIM Group, can be uncomfortable at times. This month, I’ll address some of the discomfort that can occur with our approach. I’ll also share some thoughts on why I feel that by accepting some of this discomfort along the way, our approach can lead to better long-term outcomes than alternative approaches like indexing. Sprinkled throughout the newsletter, you’ll find a number of exhibits.

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Radical Responsibility = Good for the USA

A few weeks ago, my brother Bobby (founder/chief cherry guy at Cherry Republic) and I were chasing our boys through the woods near Glen Arbor, Michigan, where we grew up. Bobby and his family live near his store in Glen Arbor, not too far from Mom and our childhood home. As we were playing “hide and seek,” Bobby stopped by an area where the trees had been blown down by the “storm of the century” this past August.

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October 19, 1987 – Black Monday

On October 19, 1987 – Black Monday – the U.S. stock market crashed 22% in one day. Linda Brezezinski (my only staff member at the time) and I were very busy that day…buying! That night, I served as an adjunct faculty member for the CFB Board and taught a course at Northwestern Michigan College to those achieving Certified Financial Planner (CFP) designation.

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Where Have All the Long-Term Investors Gone?

Everything is cyclical – spring/summer/fall/winter…recession/recovery/boom periods…deflation/inflation. An experienced farmer knows full well that weather directly affects the harvest, so he is prepared for both good and bad years. His success lies in the patient preparation and planting of the soil. Today, it seems that investors are obsessed with short-term performance (three years or fewer).

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Dividends Don't Lie

This month I’d like to discuss dividends. I’ll highlight a few stats that Swiss Bank UBS put out in a recent riveting 50-page report titled “Safe dividends in times of financial repression.” Before that, though, let’s briefly go over some dividend basics and our team’s recent thinking on dividend payers. I should also point out that Zach writes on one dividend-heavy sector for our managed accounts, real estate, later in this newsletter.

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Anxiety, Lazy Brains, and Investing

Why invest? Why get an education? Why not just live for today? Why plan, be forward-looking or think about the future? Of course these are loaded questions, but the answer is simple: We must be forward-looking because we live in the future and have no choice but to assume that the world will be here tomorrow, that the economy will not crumble and my home will still be standing.

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Lee Kuan Yew

Lee Kuan Yew, the first prime minister of Singapore who governed for more than three decades from 1959 to 1990, passed away last month. Lee left a legacy that proved that you can change a culture, you can pull a country out of poverty and you can create a first-world county that’s ranked 7th in least amount of corruption, highest in pro-business, provides economic freedom, ease of doing business, social cohesion, employment, education and the 3rd highest per-capita GDP in the world.

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Zero or Hero

During a recent investment committee meeting, I recalled a conversation I had back in the early ’80s with a fellow money manager who was much more experienced than me. I asked him what he thought the ideal “paranoid-conservative, set-it-and-forget-it portfolio” would look like. His response: 10% gold for economic uncertainties like hyperinflation and geopolitical stress, and 90% U.S. Treasury bills for stability.

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