Broker Check

April 30, 2015

You Cannot Eat Return

          Our investment strategy of income and growth is not the currently fashionable strategy of growth investing.  Growth investing means you go for return on investment, that is, the growth in the value of the investment.  The problem with that strategy is that the value of investments go UP and DOWN.  YOU CANNOT EAT RETURN if you need cash that month in order to pay your bills.

          If you need to live on income from your investments you need to have yield, that is you need to have actual cash flow that can be paid to you that you can then use to buy something like food and rent.  YOU CAN EAT YIELD.

          Our strategy is a combination of the two.  We look to TOTAL RETURN, which is a combination of YIELD and RETURN.  While all strategies seek to better one’s situation, one must consider what you have to do or how you will live while WAITING  for investments to go up because all investments go UP and DOWN.  Our objective on all accounts is to provide a cash on cash return of 6.5% - 7.5% with the possibility of an upside over a PERIOD of time, so you can be paid to wait because a period of time maybe longer than expected.

           We worry about this, so you don’t have to. 

            For more discussion as to how we pursue this strategy, please call us.


            During tax season, many who came into the office expressed how nervous they were regarding the stock market and their investment performance.  We tried to express how concerned we were also.  But, because we predicted a sluggish stock market that essentially is going sideways, we were not alarmed.  We have attached a link to the November 2008 newsletter for your review and for you to see how prescient we were.

            The only event we did not predict, was that Saudi Arabia would increase daily oil production by almost 25% in order to reduce the price of oil, and thereby put pressure on Shiite Iran and Russia in order to try and prevent Iran from getting the nuclear bomb that Sunni Saudi Arabia believes President Obama means to give to them.  Additionally, Saudi Arabia has reduced the price of oil that can be sold to Asian customers.

           As always, if you have any questions about these or any other matters, do not hesitate to call us.

           Remember, We’re Here For You!