By DAVID MOON, Moon Capital Management
April 8, 2007
I took my family on a spring break vacation a couple of
weeks ago ' and I encountered some pretty valuable business lessons.
was a rat. A most famous Rat.
Along with apparently a third of the earth's population, we visited
Disney World during spring break.
The hidden becomes obvious when the surrounding elements are pushed to
the extreme. A rat park seemingly filled with 2.3 billion people is
Here's what I learned.
People will do the craziest and most unexplainable things if others are
doing it. I saw grown men wearing fanny packs and Mickey Mouse ears.
I've also seen grown and presumably intelligent men buy silly investments
simply because other people were buying them.
I learned that lines are always shorter on the left. Or lines are always
longer on the right.
The only possible explanation I can offer is that since most people are
right-handed, they naturally tend to the right. And if my observation is
accurate, people are more likely to do what is comfortable and natural than what
is in their best interest.
Think about that the next time you hold onto some stock simply because
your grandfather owned it.
One day at Epcot Center, there was a long line near the popular Soarin'
attraction. I asked the last person in line if, in fact, it was the line for
Soarin', to which she replied, 'I don't know. We just saw the line and got in
I am not making this up.
After a bit more research, I discovered that the line was for ice cream
Lesson: not only are some people ignorant, some of them know it and don't
Monopolistic pricing was obvious at Disney World. With a captive
audience, you can charge $7 for a beer or $8 a page to send a
I was also reminded that with slick packaging, you can sell almost
anything. The gift shops at Disney featured a lot of nice products. But they
also sold plastic junk that had nothing to do with any Disney character or other
Disney-related corporate entity.
One example: little plastic things
with string spinning through them. Adorned with a mouse sticker, these useless,
temporary toys were hot items.
I've seen plenty of partnerships, stocks and private equity placements
sold that way, too. Fancy sticker, little substance.
I spent a week and more than a few hundred dollars eating horrible meals
and standing in lines for dozens of hours. I was ready to punch the next cast
member who put on a fake smile and told me to have a 'magical day.' I did all of
this for my kids.
What did my children enjoy most? You guessed it: the hotel pool.
We could have gone to the Baymont
Inn at Strawberry Plains, played in the pool and ridden a bus to the Knoxville
Zoo each day ' and told them it was Disney's Animal Kingdom Lodge. They would
have been fine.
In life, as investing, lessons can be very
Thanks kids. Thanks Mickey.
Last week I reported all sorts of outrageous things, including the fact
that I would quit writing this column because it was no longer fun. The entire
column was an April Fool's joke.
David Moon is president of Moon Capital Management, a
Knoxville-based investment management firm. This article
originally appeared in the News Sentinel (Knoxville, TN).