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Epilogue
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We've experienced a remarkable swing of the financial pendulum in the last five years. We've gone from embracing the stock market, cheering the relentlessly higher levels of the averages, to spurning eq­ uities and accepting that they are difficult to fathom, manage, or profit from. We lusted for shareholder democracy, where each person built his own portfolio and monitored and maintained stock positions, eager to take advantage of the hottest trends. Now many people be­ lieve that stocks are a crooked affair, one that only the richest and most well-connected people can possibly afford. Stocks, which regularly trumped homes in rising values for all of the 1990s, have now stayed flat while we've gotten used to 20 percent appreciation year after year for the properties we live in. We've gone from checking our portfolios daily, even hourly, to selling all our stocks and not even bothering to open the statement from our mutual funds. Firms we trusted to be fiduciaries sold our net asset values from underneath us. Research that we thought was honest turned out to be corrupt, paid for by the very companies that were being reviewed. We put faith in managements that soon will be occupying whole wings of federal prisons. We stopped funding our 401 (k)s; we gave up trying to fathom which stocks went up and which ones went to zero.

My chief motivation for writing this book was to get you to understand that there are always opportunities to make money, always bull markets to find, always stocks that will go higher, even in the crummiest of markets. I think the pendulum has swung too far now, that as silly as it might have been to check our net worth by the minute on the Web, it might even be sillier—and more dangerous—to do nothing with your money today. Retirement's always around the cor­ ner. Your paycheck isn't big enough and it won't last forever. You can't sell your house without buying something else to live in, and that makes the wealth of your house impossible to tap without a dramatic change in circumstance.

That's why I know it's time for you to get back in. This time though, because you will use the principles and common sense of this book, it won't end the way it did at the turn of the last century. In fact, it won't end at all.

But let's say I am wrong about the market swinging too negatively. Let's say that the awful roller-coaster market—up and down and up and down and then finish the exact same place but with a sick-to-our- stomach feeling that makes us dread the process—continues; seven fat years, seven lean years so to speak. I think I have shown in this book that there are always needles in the haystack, groups that work, always bull markets out there somewhere. You just need these tools to know where to look for them.

By no means am I saying it is easy. I insist on buys only with home­ work, I insist on staying on top of your portfolio. I demand that if you are going to buy individual stocks you get involved and stay involved, and that if you don't have the time or the inclination you must hand it off to others. I know, though, without a doubt, that you have to learn to be either a better investor or a better client; there is no other choice.

Home Depot has a terrific saying: "You can do it; we can help." I think that most professionals, including those you see on television or read in print, have come to a different conclusion: "You can't do it and we can't help." As someone who has traded and made money in all sorts of terrible markets since 1979,I know you can do it, and I know I most certainly can help. My methods, which involve hard, time- consuming work and lots of common sense, constantly generate win­ ning ideas and cull out losers that could wipe out whatever good you might be doing. I know what you did wrong the last time around, and I know that I have offered cures, not panaceas, to that behavior.

I know I will never be willing to concede what so many folks do now, which is that you can't beat the averages, so you might as well join them. In sports, that would be the equivalent of saying that no college player can ever rise to the NBA or the NFL level so why bother to aspire. We know that some do make it, we know that in this game we don't need the God-given talents that those players have to have. We just need hard work, some rules and some discipline, and we will beat the averages.

My styles and methods aren't in the textbooks. Nobody I know divides the universe into the retirement stream and the discretionary stream and allows you to be as aggressive in the discretionary stream as you should be conservative in the retirement stream. No one I know embraces speculation, embraces the finding of lowly stocks, trying to catch the unexploited before the pack, even if the unexploited never, ultimately, amounts to anything. As long as you restrain yourself to no more than 20 percent of your discretionary funds in speculative hold­ ings, you are not violating any rule that will come back to haunt you. And if you are still rolling the dice with 100 percent equities for retire­ ment a few years before you need that money, you just wasted your time and money reading this book.

Will we ever return to the days when fortunes were made overnight in the market, when the closing prices flashed on billboards around baseball stadiums and every bar and health club had CNBC on round-the-clock? I don't think so. I don't want it, either, because then it is too easy, and when it is too easy, we lose the rigor, and ultimately, we lose the money that we have invested. I like it hard; I like it difficult to fathom. That makes it so there are fewer people out there to grab the great ideas. The great stocks don't get bid up so fast that we have to sell them as soon as we buy them. And sell them we must if we are going to hold on to the gains, because selling's part of the discipline of stocks that we have all forgotten.

So, go build that portfolio. Remember, even someone like me, swinging around hundreds of millions of dollars at one point, never did anything rash, never did anything all at once, never felt he had to be "big" at one level, only to see the market get cracked right after I spent all my hard-earned money. Take your time this time. Do it right, do it with caution, approach it with the same thought you would give any large dollar purchase. Live by the rules here, recognize that your rules and your discipline are your only friends in a world where the government can't protect you from the rapacious folks who we now know dominated the boardrooms of both Main Street and Wall Street.

You will make mistakes. You will lose some money. You might not become a millionaire overnight, as so many charlatans in my business claim at seminars and in books. But you will be doing it the way the real pros do, the ones who beat the markets, all markets, the ones who know that you don't have to have a bull market in all stocks to make money. I can't ask you to love stocks as much as I do, but I can ask you to take care of yourself financially, because, alas, no one will ever care as much about your money as you. Get started toward saving. Today. Unlike so many things in life, you will never regret it. And one day, I hope, you will look back and think, Holy cow, I can't believe how much money I was able to make, just when everyone else thought that stocks would never ever work again.

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