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I was pondering the ups and downs of the FTSE 100 this morning as I was reading headlines from a couple of dozen newspapers. One source said that waiting for this month’s imminent U.S. Federal Reserve announcement was holding the FTSE down. Another said that the FTSE will reach 8,000. The problem was that it was not just two papers. Nearly every paper I read said that either one thing is pushing the FTSE up whilst another said something else was pushing the FTSE down. I was so confused, I decided to call my good friend, Warren Buffet. When I explained my dilemma, he said, “I never attempt to make money on the stock market. I buy on the assumption that they could close the market the next day and not reopen it for five years.” Perhaps that is the real reason that Warren Buffet is a billionaire and most of the rest of us are not.
He didn’t leave me with just two sentences, but he continued with his advice. “Look at market fluctuations as your friend rather than your enemy; profit from folly rather than participate in it.” It was like a lightning bolt from heaven had come down and, instead of striking me once, slapped me around my head for a couple of minutes. I think I get it. He was telling me that my investments are not in the market, but in individual companies. Mr. Buffet does not worry about the market. He focuses on his investments and the issues that directly or, to some extent, indirectly affect those companies. The index doesn’t matter, because he is not invested in it.
He added a bit of advice . . . “The smarter the journalists are, the better off society is. For to a degree, people read the press to inform themselves – and the better the teacher, the better the student body.” Wow. That’s a heavy cross to bear, but I am up to the task.
I hereby reaffirm and rededicate myself to reporting facts that help readers to understand what is happening respective to particular companies, their market sector, and the government. I will uphold the philosophy of “buy and hold” in opposition to the endless repetition of “buy and sell, buy and sell, buy and sell, buy and sell, buy and sell, ad infinitum and ad nauseum. I commit to keep reporting the facts and not the back and forth fear-mongering and anxious anticipation that so many others do when the FTSE goes up or down. My philosophy, learned at the feet of Mr. B., is “Hey, the market has to go up or it has to go down. Or, it could remain pretty much the same. That’s about the sum of it.”
So, here’s what I’m going to do. I’m going to continuing investing in companies where I see the best opportunities for growth, and I am going to not worry a whole lot about FTSE fluctuations and the headlines like the ones I read this morning, examples of which follow:
- FTSE 100 to reach 8,000, Citigroup predicts
- London Report: Arm’s advance helps to steady FTSE 100 index
- FTSE 100 stalls ahead of Lehman anniversary
- FTSE-100 rises as fears over Syria subside
- Taper fears keep FTSE in check
- Banks boost FTSE 100
Mr. B. closed with a final thought, comparing Canary Wharf to Wall Street. He said, “Remember, they are the only places that people ride to in a Rolls Royce to get advice from those who take the subway.” Good observation. I thanked him for his kindness and we said our goodbyes. I heard him speaking to his secretary as he was hanging up his phone, “Helen, who the %(^)% was that guy?”
*Disclaimer: This is a fictional story comprised of actual quotes from Warren Buffet. None of those quotes were directly related to the FTSE 100, but his philosophy, nonetheless, is applicable. Warren Buffet quotes are available at Brainy Quote.com. Warren Buffet doesn’t know me from Adam, but I think that he would like me if he did.
