By DAVID MOON, Moon Capital Management
After 20 years of stumbling around the pages of the Wall Street Journal,
reading Peter Lynch books and listening to the pundit-of-the-day on television,
I've finally found the fountain of investment wisdom: wee-ball practice.
If you're not familiar with wee-ball, imagine kindergarten recess - but
without all the organization and discipline. A kid is a great wee-ball player if
he gets through practice without crying.
I told you this was like investing.
Investing is more complicated than wee-ball, but only because there is some
algebra involved in investing. Other than the math, there are a lot of
similarities between the two. In both activities, many participants have a
tendency to move around a lot more than they need to. Some players get
depressed, sit and play in the dirt. Other kids, not knowing what to do, just
mimic the person next to them.
The part of the game wee-ball players look most forward to is when everyone
gets together afterwards for the drinks ' just like on Wall Street.
At practice last week, one parent spent 15 minutes trying to teach his
four-year-old son about footwork, leverage and balance. All the kid wanted was
for his dad to race him to the third 'pillow.' (Sorry, son; we'll race this
week. But they're called bases, not pillows.)
Other parents were worried about batting stances, throwing motions and jersey
colors. We forget that wee-ball just isn't that complicated. Even if your goal
is to develop your four-year-old into the world's all-time best wee-ball player,
a parent would have a better chance by encouraging his child to be very
physically active, play catch and have fun. It's not that complicated.
In the late 1990s, a group of astrologers held an investment conference in
New York. I imagined a few dozen middle-age Star Trek fanatics telling each
other that the key to a long, wealthy retirement was to 'live long and prosper.'
Instead, the meeting drew more than 500 people, many of them with suits, ties,
briefcases and Barron's subscriptions. These were seemingly serious investors '
seemingly. The only clue that they had been beamed off the galactic reservation
was that they were picking stocks and committing real dollars on the basis of
star and planet alignment. Move over Warren Buffet; make room for Mr.
Years ago at an art show, I quietly admired the depth and feeling in an oil
painting of a farm meadow and adjacent river. The artist had captured not only a
visual impression of where I grew up; he also understood and communicated the
emotions that permeated my childhood. Using colors and brushes he was able to
show the juxtaposition and conflict between the beauty and the destructive
forces of nature that simultaneously existed in this one place. Standing next to
me also enjoying the painting was a young man, probably in his teens. He was a
tad disheveled and looked more than a bit out of place at the show. I glanced at
him and said, 'This artist must have lived an amazing and full life to be able
to capture such human emotion without even putting a human being in the picture.
I wonder what inspires this guy?' The kid next to me''the artist, as it turned
out''replied, 'I don't know; I just paint stuff I think I can sell.'
Sometimes things are much simpler than we think they are.
David Moon is president of Moon Capital Management, a
Knoxville-based investment management firm. This article
originally appeared in the News Sentinel (Knoxville, TN).