Arnie vs. Jack: Who Was the Better Investor?
“I’d rather win one big tournament in my entire life than make the cut every week.” — Arnold Palmer (p. 160, “Maxims of Wall Street”)
I’ve played golf most of my life, and have always enjoyed the sport once I stopped keeping score!
I especially remember the invitation I received from a member (and subscriber) to play at the famous Augusta National Golf Club, where they play the Masters. I can never forget when I sat in President Dwight D. Eisenhower’s chair at dinner.
I just finished reading a fascinating story of one of the greatest rivalries in sports. Arnold Palmer and Jack Nicklaus went head to head during the 1960s and 1970s.
Palmer was the more popular of the two because of his humble background (he was the son of a greenskeeper) and his plain-spoken charisma.
Palmer won four green jackets at the Masters and seven major titles. He also did more than anyone to popularize the game of golf.
Nicklaus is considered the greatest golfer of all time, as he won 18 major championships, three more than Tiger Woods, and is both the youngest and the oldest golfer to win the Masters in Augusta.
Palmer, “the King,” was 10 years older than Jack, “the Golden Bear,” so the rivalry didn’t last long. However, it remained intense even after their playing days were over.
From an investor’s point of view, Palmer and Nicklaus couldn’t have been more different, both on the golf course and in business.
Palmer was aggressive and became famous for taking risky shots to come from behind and win a tournament. He hardly ever played it safe, and that cost him a few contests.
Nicklaus was a more conservative and steady performer who had remarkable skills of concentration. Other players constantly complained about how slowly Jack played the course.
Playing the Market: Which Approach Wins?
When it comes to managing your portfolio, which style is better?
The unemotional Nicklaus approach is probably better suited for most investors than the high-risk gambling style of Palmer.
The conservative investor will engage in dollar-cost averaging. He or she will also invest in index funds and not panic during a crisis.
But then all work and no play makes Jack a dull boy.
As George Soros says, “If investing is entertaining, if you’re having fun, you’re probably not making any money. Good investing is boring.”
Sorry, George, but I’m more in Arnie’s Army as I love the high-risk stakes of speculating in individual stocks, timing the market and occasionally profiting big. Investing has to be exciting to keep my interest.
I do keep most of my investment portfolio in index funds, well-managed mutual funds and exchange-traded funds (ETFs). But I like to speculate with some of my money. It makes for good conversation at cocktail parties.
They Take an Opposite Approach in Business, Too
Interestingly, Arnie’s and Jack’s approach to golf were totally different from their approach with regards to business.
Palmer’s businesses were conservatively managed by Mark McCormick. He built a fortune worth around $875 million from endorsements, appearances, licensing and course design fees. Even after his death, his businesses earn $40 million a year.
It’s a different story with Jack Nicklaus. His business endorsements and financing of golf courses turned into a fiasco. At one point, he owed more than $100 million and considered filing for bankruptcy until he worked out a deal with the banks.
In sum, the game of sports is not the same as the game of business. Just because you are successful in one doesn’t mean you will be successful in the other.
The same is true for businesspeople. My #1 lesson is, “The business of investing is not the same as investing in a business.” Many a successful business person can end up bankrupt by taking foolish chances on Wall Street.
The above quotes from Arnold Palmer, George Soros and myself are taken from the new 7th edition of “The Maxims of Wall Street.”
Dennis Gartman said it best, “It’s amazing the depth of wisdom one can find in just one or two lines from your book. I have it on my desk and refer to it daily.”
Jack Bogle, the legendary founder of the Vanguard Group of funds, wrote, “What a treat! It’s great to have all these sayings in a single spot.”
A subscriber and I enjoy reading quotes from the “Maxims” on a cruise ship.
I offer a super bargain price for the “Maxims.” The first copy is $20, and all additional copies are $10 each. I autograph each copy, number them, and mail them at no extra charge. If you order a box (32 copies), you pay only $300.
To order go to www.skousenbooks.com, or call Harold at Ensign Publishing, 1-866-254- 2057.
Update on the Masters of Conferences
FreedomFest has been called the “Masters of Conferences,” a three-day intellectual feast in Las Vegas for investors, business leaders and concerned citizens.
This year’s Masters tournament was postponed, but not FreedomFest! It’s set for July 13-16 at Caesars Palace. They are rolling out the red carpet for us. Hotel rates are only $119 a night at the five-star Caesars Palace or only $57 a night at the Flamingo across the street!
And parking is again FREE in Vegas for our show.
We just confirmed the attendance of Dr. Drew, the famous M.D. and TV personality. Other speakers include Steve Forbes, Steve Moore, Charles Murray and P. J. O’Rourke. For the list of other great speakers, go to www.freedomfest.com.
To find out more about FreedomFest, read my “Open Letter to All Freedom Lovers” here.
Eagle Publishing will be celebrating the 40th anniversary of my newsletter with celebrity gurus such as Alex Green, Adrian Day, Doug Casey, Louis Navellier, Jim Woods and Hilary Kramer in attendance.
And here is what we have for our Thursday night gala banquet and dance, including a special tribute to Ed Crane, the co-founder of the Cato Institute and the Libertarian Party.
To sign up, go to www.freedomfest.com, or call toll-free 1-855-850-3733, ext. 202. Be sure to use the code FF20EAGLE.
Fly there, drive there, bike there, be there!
Good investing, AEIOU,
Mark Skousen
You Blew It!
Should You Feel Inclined to Censure
“Should you feel inclined to censure
Faults you may in others view,
Ask your own heart, ere you venture,
If you have not failings, too.
Let not friendly vows be broken;
Rather strive a friend to gain.
Many words in anger spoken
Find their passage home again.” — Anon.
In church, we used to sing a hymn called “Should You Feel Inclined to Censure.” The identity of the author is unknown, but the lyrics are persuasive.
Maybe it’s time we started singing this hymn again. It might help heal the divisiveness in America’s politics these days.
President Trump is planning to sign an executive order today that threatens action against Facebook, Twitter and Google for engaging in censorship and silencing views they don’t support. Yesterday, he wrote that, “Big Tech is doing everything in their considerable power to CENSOR in advance of the 2020 elections. If that happens, we no longer have our freedom.”
Actually, freedom in the land of the free also means we have the freedom to censor. Parents often chastise their children for using improper language. Teachers limit what students might say in class.
As they are private companies, social media outlets can choose to ban undesirable photographs, statements and fake news. That’s their privilege. It’s a free country, right?
But in general, parents, teachers, administrators and businesses should minimize censorship as much as possible. You don’t want to stifle individuality, creativity or debate.
Private businesses have the right to impose all kinds of rules and regulations, but if they are smart, they should keep those rules simple, limited and easy to understand.
Unfortunately, the giants of social media are overdoing their bias. As a result, they are hurting their business model. The problem is finding a competitive system in social media so everyone has an outlet to speak their mind.
Government should avoid banning political parties, including the Communist Party. Stifling free speech and our First Amendment rights is dangerous and can lead to protests and violence.
Since all three companies — Facebook, Twitter and Google — are publicly traded companies, the best solution is for the critics to start their own social media companies and compete with Big Tech.
Or, followers of free speech can join together and complain at shareholder meetings. Alternatively, they could even raise the funds to take over these companies instead of running to government for relief.
But, that will take a lot of money.
