No. of Recommendations: 9
Okay, Starrob and some others have a different way of investing than I do.

"Their forth-coming ESR products that they refer to are Electro-Slag Remelted forged products (whatever that means)."

Yes, I acknowledged that I didn’t know (or care) what electric slag remelting was… as long as it meant products that were in demand for the company and higher margin.

I invest in AMZN but I don’t know (or care) how the Kindle works, just that it works. I invest in ANSS but I don’t pretend to understand engineering simulation software. I invest in CRM, but I don’t understand cloud computing… I look at sales and earnings and opportunity.

It was also pointed out that there is no barrier to entry for electric slag remelting. I made a quintuple this past year on WATG (used to be a GG recommendation). They make starters and alternators for cars in China. Where’s the barrier to entry? The same for SORL. They make airbrakes for trucks.

Finally it was pointed out that I didn’t understand the complicated internal structuring of these companies. Well I truly didn’t understand the internal maneuverings at WATG either. I just gave up trying to understand it and bought the stock.

I play cards, too. If I waited until I knew what everyone had in their hand before I bid, I’d never bid. I play the odds, in the broad sense of the term. If I have a good hand I bid and I know sometimes I’ll be set. That’s life. It’s how the whole game comes out at the end.

I’m an old guy. I’ve been doing this for years. The past decade has become famous as the first in a long time where stocks were DOWN for the decade, as much as 30%, I think I heard….. Well I was UP 568% on the decade… inspite of 2008. Here are the figures, using $1000 for a starting figure for clarity:


Jan 1, 2000.... $1000,0

2000... 19.4%.... $1754,0
2002... 19.7%.... $2099,5
2003... 124.5%... $4713,4
2004... 16.7%.... $5500,6
2005... 15.6%.... $6358,7
2006... 8.6%...... $6905,5
2007... 22.5%.... $8459,2
2008... -62.5%... $3172,2
2009... 110.7%... $6683.9

Total Gain... 568,4%


As you can see, most of the years were just small gains: 8.6%, 15.6%, 16.7%, 19.4%, etc. but it totals out to a 568.4% gain in the ten years. You can multiply it out for yourself.

Was I scared in 2008? Damn right. In November I was actually down 68.5% before a bounce back in December. Did I stay 100% in stocks when everyone was saying “Get out! Get out!”? Yep.

Have I ever got burned on stocks? Of course. For example some years ago I invested in a US listed company based in Cyprus which turned out to be a total fraud. The owners absconded with the money and disappeared. I got out on the way down fortunately and just took a 30% loss. I think that has happened to me twice over the years (companies which were frauds or dishonest, plenty more where I just lost money). I must have invested in at least five or six hundred companies over that time (just guessing). Certainly well less then one percent of companies turned out to be frauds.

Could that happen with one of these Chinese companies? Sure. Is it likely? No. Will it happen to all of them? Impossible. If I buy a stake in fifteen or twenty little companies that are growing 50% - 100% a year and one turns out to be a fraud and tanks, will I still make money? Lots. Have I heard of any, ANY, Chinese stock that has turned out to be a fraud? No. Have you??? Are there any out there? Probably, but obviously not many or we’d be reading about them. When management/owners can make 50% a year just building their own stake in an exploding economy, why bother. If they double the size of my company two or three years in a row, do I really care if they pocket $100,000 along the way?

I put out a couple of ideas of neat little companies, just for interest, but got just a stream of criticism and almost hysterical attempts to destroy their credibility. (I consider four posts in a row by the same poster, attacking different parts of the last stock, pretty hysterical and overdoing it). I understand some people's need to know everything about a company before investing about it. That's not my philosophy. I quit suggesting new stocks for now. It just doesn't seem worth the trouble.
Print the post  

Announcements

What was Your Dumbest Investment?
Share it with us -- and learn from others' stories of flubs.
When Life Gives You Lemons
We all have had hardships and made poor decisions. The important thing is how we respond and grow. Read the story of a Fool who started from nothing, and looks to gain everything.
Community Home
Speak Your Mind, Start Your Blog, Rate Your Stocks

Community Team Fools - who are those TMF's?
Contact Us
Contact Customer Service and other Fool departments here.
Work for Fools?
Winner of the Washingtonian great places to work, and Glassdoor #1 Company to Work For 2015! Have access to all of TMF's online and email products for FREE, and be paid for your contributions to TMF! Click the link and start your Fool career.
Advertisement