Kennon-Green & Co. Global Asset Management, Wealth Management, Investment Advisory, and Value Investing

Winter Project

The 30 Day Secret Project Every One of You Should Adopt

I’ve been thinking about you this Christmas season.  This audience is unique.  Demographically, you represent a collection of men and women with far above average talents, connections, and resources.  The power you have to change lives in your own communities is huge.  A small amount of output, when you set your mind to it, can have a disproportionately large benefit…

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Coca-Cola Plant

How Thomas and Whitehead Used Synthetic Equity To Build Massive Fortunes, While Simultaneously Creating Thousands of Coca-Cola Millionaires in the United States

In the late 19th century, a man named Benjamin Franklin Thomas decided he wanted to be rich.  He became obsessed with business, investing, and finding a single opportunity that would set him up for life, allowing him to live off his capital.  According to Constance L. Hays in her book The Real Thing: Truth and Power…

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Super Mario 3D World Large

A Handful of Rare Businesses Enjoy Annuity Streams That Can Generate Cash for Decades

For the past hour, my mind has been on the power of some businesses to capture annuity streams that pay dividends for years, even decades or generations, with very little additional work.  When you can get one of these in your portfolio, they pump out wealth as long as you update them every once in a while.  They are the closest thing to geese laying golden eggs that exist outside of fairy tales.

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Dies Irae Principle

The Dies Irae Principle

I’ve been thinking about how differently people see the world and how that influences their view of events.  Something that rolls off one person’s back can cause another to spend a week sobbing in bed, barely able to contain their grief or embarrassment.  What is a minor setback to one person can be a career-ending…

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Douwe Egberts Acquisition

One of Europe’s Oldest and Most Secretive Families Has Been Using Its Private Holding Company To Buy Up The World’s Coffee Assets

I’ve watched in fascination over the past couple of years as German conglomerate Joh. A Benckiser has been quietly buying up the world’s leading coffee brands, acquiring Caribou Coffee for $340 million, Peet’s Coffee & Tea for $974 million, and my personal obsession, Douwe Egberts for $9.8 billion, among others.  The firm is the personal holding company of…

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Providence New American Kitchen Restaurant Kansas City Meatloaf

Dinner at The Providence New American Kitchen at the Hilton President in Downtown Kansas City

Aaron, Caleb, Tara, and I are in downtown Kansas City because later this evening, we are meeting Matthew and his wife Jaclynn at the Lyric Opera of Kansas City to see the premier of Mozart’s The Magic Flute.  Arriving early, we realized we hadn’t eaten anything and picked a nearby restaurant that had decent reviews; the Providence New American Kitchen at the Hilton President.

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Ku Hye-sun

Six Months. I Made It Six Months But I Fell Off the Korean Bandwagon … I’m 15 Hours Into 꽃보다 남자;

I’ve never smoked.  I hate the taste of alcohol.  I’ve never done drugs.  I did well in school and became successful at an early age.  I save way more than I spend, growing my family’s investments every year.  I’m far more productive than the typical person in my country.  Specifically, the average American spends a staggering…

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Pumpkin Spice Roll Cake

Birthdays, Rocks, Cooking School, Retirement Plans, and Late Night Work Sessions

You know that old television show 7th Heaven?  Sometimes, I think I live in it.  I was woken up this morning by my five-year-old niece, two-year-old-nephew, and grandmother (their great-grandmother) calling a phone I keep beside my bed.  She (my grandmother) was watching the kids; they missed us and wanted to talk since we hadn’t…

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Cheese Boards and Cheese Samples

I’ve Become Obsessed with Fine Cheeses

By now it should be no surprise that cheese in on my mind.  (I was excited for the suggested cheeses several of you left on the other post; thank you for those!)  I have a huge book on its way that details the different types of cheeses, how they are made, the flavor profiles, and more, which I can’t wait to dive into sometime next week.  I’m not quite so ready to begin actually making artisan cheeses ourselves, but I do want to add this topic to the list of things we know beyond the education that has been picked up through trial and error over the past few years due to our culinary pursuits.

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United States Net Worth Economy

The S&P 500 and U.S. Household Wealth Have Reached Record Highs

We’ve done it again.  Despite our own stupidity, and constant attempts to trip ourselves up with in-fighting, at this exact moment, by nearly every conceivable economic metric, the United States has the largest group of individual people enjoying a higher standard of living, more total wealth, longer median lifespans, and more free time than any other civilization that has ever existed, at any point in recorded human history.  There has never been a point when life is better than it right now.  You’re living it.  I feel like we should go get a cake or something.

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United States Treasury Department Debt Ceiling

The Debt Ceiling 101 – An Explanation for the Average Person

It’s time we talk about the debt ceiling and what a debt ceiling default would mean for the United States.  I’ve avoided this conversation because I was hopeful we would never end up here, again, after the last round of stupidity.  I’ve also avoided discussing the on-going shutdown of the Federal Government, despite some strong…

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3 Parent Biological Children

The Secret 3-Parent Biological Children Born In the United States Are Now Teenagers

With the public suddenly seeming to notice that three-parent biological children are now a scientific possibility, The Telegraph is reporting, “A group of 34 European politicians, including eight British MPs and peers, has signed a declaration attacking plans which will make the UK the first country in the world to permit the new IVF technique.” Here’s the…

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Swedish Meatballs with Lingonberry Sauce

Swedish Meatballs and Lingonberry Sauce with Last Night’s Episode of Breaking Bad

After my mom, dad, and youngest sister stopped by this afternoon for banana birthday cake, my brother and, later, my sister-in-law, came over for dinner.  We ended up opting for Swedish meatballs with lingonberry sauce and chunky red potatoes, while Tara, Aaron, and I caught up on last night’s episode of Breaking Bad, which none…

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Mail Bag Questions and Comments for Joshua Kennon

Mail Bag: Cash Flow Versus EPS for Intrinsic Value Calculations

This is one of those inside-baseball questions that the serious, more-than-part-time investors out there will probably enjoy. Hi, Joshua.  I could read your blog all day.  Thanks for everything that you do. When I read your commentary on payout ratios, it seems to focus on EPS payout ratio, or dividend coverage.  I don’t understand why you don’t…

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Hawaii Overprint Bank Note

Hawaii Overprint Banknotes

When the Japanese attacked Pearl Harbor, the military brass quickly came to the realization that if the islands were to be captured, the invading army would have access to a large amount of United States banknotes, held by individual citizens, businesses, banks, and institutions, which they could then use throughout the world as there was…

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Successful People Want to Marry Other Successful People

Income Inequality Is Partially Caused By Women Joining the Work Force

We’ve talked about income inequality a couple of years ago; specifically touching on the role of marriage patterns and assortative mating in household income levels.  We’ve also discussed the economics of assortative mating more directly – the deeply ingrained tendency of people to marry other people like themselves with similar educational backgrounds, cultural values, personalities, and career orientations. One interesting result of this is that the women’s liberation movement in the 1960s and 1970s planted seeds of radical income inequality that are just now coming to fruition. Of course, it’s not the only cause of income inequality, but it certainly does play a meaningful role in the gap that has developed between the well-heeled and the penurious.

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Home Grown Roses in Vase

It’s a Hyper-Focused Project Day Today

Last night, I had this intense craving for a dish we made back in January, a caramelized carrot soup with peanut butter and cinnamon garnish.  I swung a deal where, I would get it prepared for me today if I agreed to prepare several loaves of whole wheat artisan breads that could be used over the next week for sandwiches and panini.  It seemed like a fair trade, so later tonight, I’ll be busting out the pans.  It was fun, because while the soup was being made and filling the house with this really unique, and hunger-inducing fragrance, I tried out the newly remastered Ducktales Game on PlayStation.

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Ayds Diet Pills

How the Mere Association Mental Model Destroyed a Perfectly Good Diet Business

In the 1930’s and 1940’s, the Carlay Company in Chicago, Illinois developed a candy coated dietary suppressant called Ayds.  It sold the business to Campana Corporation.  Campana was then sold to Dow Chemical.  In the 1960’s, Dow sold the business to Purex and hired legendary Hollywood stars and other celebrities to endorse the product.  In…

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Cool Words

Yeah, Right

Many decades ago, Oxford Philosophy of Language Professor J.L. Austin and Columbia philosopher Sidney Morgenbesser reportedly had this exchange: “In English,” Professor Austin said, “a double negative forms a positive. However, in some languages, such as Russian, a double negative remains a negative. But there isn’t a single language, not one, in which a double positive can…

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Dr Pepper Snapple Investment

An Example of Real World Value Investing Through the Lens of Dr. Pepper Snapple Group

One of the biggest dangers an investor faces when he or she decides to buy individual stocks for a portfolio is the temptation to chase something “exciting”, regardless of valuation.  That’s a foolish undertaking.  Valuation matters a great deal.  The exact same business might be a wonderful investment at 10 times earnings but a horrible investment at 50 times earnings.  It’s not enough for profits to rise, or dividends to expand; they have to offer a good return, based on what you paid, relative to a reasonable opportunity cost hurdle such as the long-term 30-year Treasury bond yield.

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Laugh-O-Gram in Kansas City - Walt Disney's First Company

A Look at Laugh-O-Gram Films, the Business Walt Disney Bankrupted

In the past week, we’ve talked about the phenomenal success of an investor who bought shares of Walt Disney Productions (now called The Walt Disney Company), a decision that would have turned a 1,000 share position costing $13,880 into somewhere between $26,672,640 and $40,000,000 between 1957 and 2013.  We even looked inside the secret family holding company, WED Enterprises, Walt Disney used to build his own family’s wealth and retain power.  Most people don’t know that before those two firms, there was another that changed the direction of Walt Disney’s life.  It did not enjoy a fairy tale ending but it did lay the foundation for the things that came much later.

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Winter White Honey Joshua Kennon

Winter White Honey Is Among the Best Tasting Honey Varieties in the World

Winter white honey – remember that phrase and start buying it now because it is among the most delicious and amazing honey varieties in the entire world.  The name winter white honey comes from the color of the honey, which is derived from the wildflowers in the Rocky Mountains of Idaho that the honey bees use to create this nectar.  It’s white and creamy, not yellow or amber.  The flavor is unreal.  None of us have ever had anything like it.  We opened a bottle and soon everyone was laughing and dipping spoons in eating it like candy.

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Supersitious Religious Beliefs

The 7 Great Cult Beliefs That Have Arisen Throughout Human History

Warning: This is the working essay I promised to release earlier tonight.  It deals with certain common cult beliefs that arise throughout human history and civilizations.  It contains mature themes, images, and concepts.  It was written for myself as a way to process and understand these recurring patterns.  Due to the length of the essay, I…

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Don’t Silent Trust Funds Constitute a Massive Loophole in Financial Aid Calculations?

My morning was spent reading the New Hampshire Bar Journal, Winter 2010 edition because I was interested in a piece by Joseph F. McDonald, III called Migrating Trusts to New Hampshire: The “Why” and the “How“.  New Hampshire, along with a very few other states, allows the existence of something known as a “silent trust” or “quiet…

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1 ounce American gold eagle bullion coins on wooden background

This Is the Kind of Business Behavior That Disgusts Me

How can people do this and live with themselves?  This is the sort of thing that if I were running a company, I don’t care if we made millions of dollars a year in profit doing it, I’d shut it down.  I believe it is immoral.  Sure, it breaks no laws that I know of but it strikes me as ethically wrong.  It is the reason we need stronger consumer protection laws in the United States.  I believe it preys on the ignorant; the people who don’t know any better and who are trying to secure their future.

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Joan

I Forgot How Much I Loathe Don Draper in Mad Men

While I’ve been working the past week or so, I’ve wanted some background noise so I loaded Netflix and began watching the 5th season of Mad Men, which I hadn’t started, yet.  I forgot how much I truly hate Don Draper.  I feel … contempt.  I loathe – that’s a rare sentiment for me but accurate, loathe – everything about him; how he treats people, how he betrays, without knowledge or consent, the women to whom he has made a commitment and whom love him, how he refuses to open himself up to others about his past or live in any sort of authentic or honest way with his family.

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Che Guevara

Unless You Are a Proud Bigot and Anti-Intellectualist, You Probably Shouldn’t Be Walking Around with Che Guevara On Your T-Shirt

I believe in wild, autonomous levels of individual freedom.  Provided you aren’t harming anyone, neither your neighbors nor the government have the moral authority to prevent you from seeking your own happiness.  It is immoral for parents to force their children into marriages, as still goes on in parts of the world.  It is immoral…

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Life in the United States

You Wouldn’t Realize How Amazing Life Is in the United States By the Media Coverage

I’ve been thinking about life in the United States.  We are a massive nation that generates $15 trillion in wealth every year.  We have consolidated assets (personal, corporate, and government) of more than $200 trillion.  Our natural resources are abundant.  Our military power immense.   Going further, take a moment to consider the following: The S&P…

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