WE ARE LONG TERM INVESTORS OF RATIONAL COMPANIES AROUND THE WORLD

May 05, 2023

As always, what we need to remember is that we are not investors in the random markets, but rather we are shareholders of capitalism in a variety of companies that act rationally to grow their profits and dividends.

Instead of experiencing “stock market” declines as “losses”, we experience them as temporary setbacks in the long upward march of shareholder capitalism.

Here are some important things to remember as owners to companies around the world:

  • The long- term upward path in the earnings, dividends, and values of the great companies, taken together, is solidly positive.
  • Given time, market prices will always migrate back toward fundamental values.
  • Bull markets go on far longer than bear markets do; they increase equity values far more than bear markets diminish them.
  • The premium return of equities is earned purely by a willingness to ride out their temporary declines.
  • The average compound rate of total return from equities has been 7% net of inflation, while the comparable return from bonds has been about 3%.

Be well, and enjoy the season of Spring. As always - we are here for you. We will be and look forward to being in touch.