Thoughts on Business, Politics, and Life from a Private Investor
The manufacturing sector in the United States generates the same inflation-adjusted profits it did in 1960. Surprised? Consider this: In 1960, the United States manufacturing sector generated total profits of $23.8 billion. In 2008, the United States manufacturing sector generated total profits of $175.5 billion. If we adjust for inflation, 2008 profits from manufacturing should have been $171.17 billion, so we are actually ahead of the game a bit. The problem is, at the same … [Read more...]
In today's installment of our mental models catalog, we are going to discuss Veblen goods, which are a special type of item that would appear, at first glance, to violate the law of supply and demand relationships to prices. Veblen goods are a type of commodity, product or service for which demand increases the higher the price climbs because buying a Veblen good is seen as a status symbol, giving the purchaser social cachet. For example, a $10,000 Birkin bag from Hermès is attractive … [Read more...]
This is cross-posted from the Investing for Beginners site at About.com, a division of The New York Times. I wanted to point it out to the readers here and tell you to head over there and check it out because I had been writing so much about Creed perfume, cologne, and fragrance products the past few days and the Creed business itself. Many of you read my About site anyway, but I just wanted to make sure you didn't miss it. For the past few days, I've been adding to my collection of … [Read more...]
Among the thousands of emails and messages I receive regularly, I came across one today that was sent to me on May 17th by Cale P. Here is the question that was posed: I'm a pretty talented IT professional with great salary and a standard quality of living. I've known that I won't be in IT for my whole career, at least I hoped. I have a natural ability to invent and I really would love to own private business(es) to see my decisions in a company flourish. However, I'm unsure of how or when … [Read more...]
I mentioned yesterday in the article on Dairy Queen franchise owners that after graduating from college, Aaron and I had looked into putting capital to work by opening several franchises in the town where we grew up. We thought it would be a good place to invest the money we were earning from our other businesses without having to be involved on a day-to-day basis. In other cases, we thought it might be a good way to structure companies so that our immediate family members could make an … [Read more...]
Last night, the shareholders of Mount Olympus Awards, LLC had a 4 or 5 hour scheduled meeting in a local office and solidified our plans for the business, which I discussed a few days ago (see Wholesale Chenille Letters, Patches, and Varsity Jacket Business Launching). The end decision was we are going much farther than we originally anticipated after doing a DuPont Return on Equity analysis. Far from being just ruthless on pricing, like I promised, we are about to drop a nuclear bomb on the … [Read more...]
I'm sitting in a Brooks Brothers bathrobe in a seventh floor suite in St. Louis working on the company MacBook. For the past few weeks, I've been toying with paid search at our e-commerce businesses. We've always had great success with organic search and, in many cases, dominate our keywords leading to terrific sales at a very low cost. However, with paid search, our staff wasn't as familiar with the mechanics and the best way to get a high conversion rate. We approved a budget to test … [Read more...]
I’m sitting in my investing office, looking over the river behind the property, figuring out what I’m going to do for the day. I’ve got a cup of coffee in my Seattle’s Best mug from Border’s and am listening to Roosterspur Bridge by Tori Amos. The ideal would be to plow into a giant pile of stock reports but that isn’t going to be possible for a few days because the operating businesses need my attention. We have so many opportunities over the next twelve months to explode in … [Read more...]
There's some exciting news coming out of headquarters in the next few days regarding the expansion of our flagship custom apparel company. We're going to aggressively go after a new market that has seen its primary players devastated by the credit crisis and, like any good American, we are going to use the situation to our advantage. We are working until about 4 in the morning to launch the new team supply business, which will be a division of Mount Olympus Awards ™, the successful … [Read more...]
This blog is a way for me to pass along some of the stuff I learn on the journey and the past year has taught me a lot about furniture, furniture buying, and what constitutes quality furniture. Tying that into our usual discussion of economics and finance, I think it provides a lot of valuable [...]
I’ve been thinking a lot about free trade, labor unions, American manufacturing, and free markets for the past few weeks. You know that, on the whole, American manufacturing is still as strong as it was in 1960. We still produce roughly $20 out of every $100 of world goods. The difference? Technology and, to [...]
Though the home renovations have gotten the most headlines due to their nature (constant onslaught of choices and tasks that need to be completed), one of the most important items on the agenda of the six-month project has been to drastically reduce my digital footprint. By the end of the program, I will have one personal presence [...]
This makes me sick. This high school is ranked in top 5% of high schools in the United States. The worst part of the video for me was the part where the kid says, “I was never taught that knowledge”. It’s not somebody else’s job to teach you, it is your job to seek out [...]
This is a great way to start the day … one of the reasons I love writing this blog. Joshua, [In American Households Continue to Deleverage But That Only Tells Part of the Story, you wrote] “The numbers are just figures on a sheet trying to explain human behavior. Study the behavior, what is driving [...]
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Investing for Beginners
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