BUY AND DIE

Well, I suppose no one actually buys the Grand Rapids Press for its financial advice.  However, it would serve the public better if the Press printed no advice than the crummy stuff from syndicated columnists in its nearly non-existent financial section.  For example, on Saturday the Press ran a Motley Fool column touting the investment advice of billionaire Warren Buffett, owner of the Berkshire Hathaway financial empire.

One Buffett "gem" the Fool relayed was:  "At Berkshire, when I purchase a company, I intend it to be for life."  What Buffett is offering here is the dangerous but common "buy and hold" strategy of investment.  As my wise ol' dad often reminds me, what goes unsaid about the "buy and hold" strategy is that you do not make a single dime off such an investment until you SELL it.  If your investment strategy does not include a clear plan for when to sell, then "buy and hold" is "buy and die".  Either you or investment goes belly up, and either way you made zilch.

Of course, Buffett didn't get rich through "buy and hold".  He has sold time and again companies and commodities he says he intended to hold for a lifetime.  It was only by selling what he bought he made his billions.  Remember, folks, there are only two sensible reasons to buy stuff.  You buy something to use it (e.g., a house, groceries, the Press to line the birdcage), or buy to sell (e.g., stocks, bonds, gold, real estate).  If you're not using it and don't know when you'd sell it, then you're in "buy and die" mode.

If I can provide you with all this financial wisdom in the space of a few paragraphs, surely the Grand Rapids Press can do better than the syndicated swill that passes for expertise in its financial section.