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The Dark Side of Student Loans
Issue #528, June 25, 2018

The Cost of Out-sourcing Convenience
Issue #527, June 18, 2018

Social Security: 66 or 70?
Issue #526, June 11, 2018

Student Loans: There’s (Unfortunately) a Lot More!
Issue #525, June 04, 2018

Co-signing a Note
Issue #524A, May 31, 2018

The Knight Frank Luxury Index and Collectables
Issue #524, May 28, 2018

The Importance of Diversification: The Myth of Diversification
Issue #523, May 21, 2018

How to Save Thousands on Your Food Bill
Issue #522, May 14, 2018

MoviePass and Other Things
Issue #521A, May 10, 2018

Degree Inflation, Long Training Periods, and “Certification”  Part III
Issue #521, May 07, 2018

Degree Inflation, Long Training Periods, and Certification” Part II of III
Issue #520, April 30, 2018

Follow-up on Several Things
Issue #519A, April 25, 2018

Degree Inflation, Long Training Periods, and “Certification”: Part I of II
Issue #519, April 23, 2018

The Kids Birthday Party Hustle
Issue #518A, April 18, 2018

A Pension Question: Part II of II
Issue #518, April 16, 2018

A Physician is an Executive
Issue #517A, April 11, 2018

A Pension Question: Part I of II
Issue #517, April 09, 2018

Is the Correction Over?
Issue #516A, April 05, 2018

Used Car Dealers, Student Loans, the Chinese, and Uncle George’s Rule
Issue #516, April 02, 2018

Starter Homes
Issue #515, March 26, 2018

Redecorating: Beware!
Issue #514, March 19, 2018

NASDAQ Closes at Record High
Issue #513, March 12, 2018

A 40% Chance
Issue #512, March 05, 2018

Several Things
Issue #511, February 27, 2018

Human Capital, Education and Wealth
Issue #510, February 19, 2018

Another Stock Market Update
Issue #509A, February 18, 2018

Some Thoughts on Savings
Issue #509, February 12, 2018

A Stock Market Upfate
Issue #508S, February 10, 2018

Who Can You Trust? Part II of II
Issue #508, February 05, 2018

The Christmas Decoration Pre-worn Jeans Hustle
Issue #Interim Bulletin #507A, February 03, 2018

2018 Outlook for Financial Markets
Issue #507, January 29, 2018

Who Can You Trust? Part I of II
Issue #506, January 22, 2018

Life Insurance Settlements
Issue #505, January 15, 2018

Commodities and Buying the Breakout
Issue #504, January 08, 2018

Buffett Wins His Bet
Issue #503A, January 04, 2018

Practice Real Estate and Free Agency
Issue #503, January 01, 2018

Outlook for 2018: Part III: Stocks and Bonds
Issue #502, December 25, 2017

My Outlook for 2018: Part Ii: Precious Metals
Issue #501A, December 21, 2017

Outlook for 2018: Hard Assets: Part I of III
Issue #501, December 18, 2017

More Thoughts on Bitcoin
Issue #500A, December 14, 2017

Fees and Good Relations with Bankers
Issue #500, December 11, 2017

Salvator Mundi
Issue #499A, December 07, 2017

Should You Rent or Own a Home?
Issue #499, December 04, 2017

A Gift Subscription
Issue #Interim Bulletin #498A, December 02, 2017

Stocks vs Real Estate: Asset Allocation: Part II of II
Issue #498, November 27, 2017

When Good Enough is Fine
Issue #497A, November 22, 2017

Stocks vs Real Estate: Asset Allocation. Part I of II
Issue #497, November 20, 2017

The Saudi Arrests and the Perils of Foreign Investing
Issue #496, November 13, 2017

Gambling and Las Vegas
Issue #495, November 06, 2017

Some Tips on Auto Insurance
Issue #494, October 31, 2017

Bitcoin and the Digital (Crypto) Currencies
Issue #493, October 23, 2017

The Coming Bear Market: Part II How to Prepare
Issue #492, October 16, 2017

Some Observations on Cemeteries
Issue #Interim Bulletin #491A, October 12, 2017

The Coming Bear Market: Part I: The Myth of Buy and Hold Forever
Issue #491, October 09, 2017

The Market makes New Highs
Issue #490, October 02, 2017

The Importance of a New High
Issue #489, September 25, 2017

A Little Insurance: Wealth, War and Wisdom
Issue #488, September 18, 2017

Some Observations
Issue #487, September 11, 2017

How to be Successful in Your Career
Issue #486A, September 07, 2017

How NOT to Buy a Home
Issue #486, September 04, 2017

This Week in the Market
Issue #485, August 28, 2017

Is the “Trump Bump” Running Out of Gas?
Issue #484, August 21, 2017

Gold is on the Move
Issue #483, August 14, 2017

The Importance of Estimation
Issue #482, August 07, 2017

Buying Art and Collecting: Part II of II
Issue #481, July 31, 2017

Buying Art and Collecting in General, Part I of II
Issue #480, July 24, 2017

Physicians need to be More Forceful: Follow-up
Issue #479, July 17, 2017

Physicians need to be More Forceful
Issue #478, July 10, 2017

Your First “Real” Investment
Issue #477, July 03, 2017

Leasing a Watch: Don’t
Issue #476, June 26, 2017

The Importance of Your Children having a Job
Issue #475, June 16, 2017

The Problem with Medical Student Debt is—the Med Schools
Issue #474, June 12, 2017

Critters and Varmints in your Home and Yard
Issue #473A, June 07, 2017

Leveraged ETFs
Issue #472, May 29, 2017

Leasing a Vehicle: Don’t!
Issue #471, May 22, 2017

Issue #470, May 15, 2017

More on Buying Jewelry
Issue #469, May 08, 2017

Buying Jewelry: Gold, Diamonds and Pearls
Issue #468, April 30, 2017

Thomas Sowell: Part III of III
Issue #467, April 24, 2017

Thomas Sowell: Pat II of III
Issue #466, April 17, 2017

Live Close to Where You Work
Issue #465, April 10, 2017

Medtronic in Hospital Management
Issue #Interim Bulletin #464A, April 07, 2017

Thomas Sowell: Part I of II
Issue #464, April 03, 2017

A Political Contribution a an Investment: Part II of II
Issue #463, March 27, 2017

A Political Contribution as an Investment: Part I of II
Issue #462, March 20, 2017

Buffett Selling Vacation Home
Issue #461, March 13, 2017

Advanced Placement (AP) ourses
Issue #460, March 06, 2017

The Importance of a Credit History
Issue #459A, March 02, 2017

A Credit Card Scam
Issue #459, February 27, 2017

The Electronic Health Reord
Issue #458, February 20, 2017

Issue #457, February 13, 2017

Platinum and Palladium
Issue #456, February 06, 2017

Economic Outlook for 2017: Part II of II
Issue #455A, February 02, 2017

Economic Outlook for 2017: Part I of II
Issue #455, January 30, 2017

A Story From Vegas
Issue #454A, January 25, 2017

Land Donation Deals and the IRS
Issue #454, January 23, 2017

The Theory of Gambler’s Ruin
Issue #453, January 16, 2017

Student Loans: But Wait, There’s More!
Issue #452, January 13, 2017

A Second Home
Issue #Interim Bulletin #451A, January 04, 2017

The Consumer Confidence Index
Issue #451, January 02, 2017


By Robert M. Doroghazi, M.D., F.A.C.C.

Thomas Sowell: Part I of II

Issue #464, April 03, 2017

    Hero is not a word I use lightly. George Marshall and George Washington are among my heroes. Growing up in the St. Louis area in the 1950s, Stan Musial, arguably one of the 10 greatest non-pitchers ever, and an honest, decent, humble man, was a boyhood hero. Thomas Sowell, who I believe is the greatest social philosopher of our time, is one of my heroes. I write about Sowell now because he recently announced that, at age 86, he is laying down his pen.
    In this letter, I’ll take highlights from an interview with Sowell in the March 18/19 Wall Street Journal, and make several other points.
    Although Sowell has his reservations about Trump, he gives him credit for being “the first Republican who’s made any serious attempt to get the black vote by addressing problems that affect most blacks who are trying to do the right thing—such as education…The most successful schools for educating black kids have been a few charter schools. There are literally tens of thousands of kids on waiting lists.
    In order to get these reforms, you would have to go against the dogma not only of educators, but the American intelligentsia in general. The teacher’s unions complain that charter schools have skimmed off the cream…that’s nonsense, because people are chosen by lottery…There people are just desperate to get into the charter schools. They don’t want to be raising a bunch of thugs”.
    RMD comment: education starts at home. We were walking into Walmart behind a mother and her kids who looked like they couldn’t even afford to shop there. I told my boys, who were about 9 and 7 at the time, “you see those kids. They will never get ahead of you—never—because I won’t let them. I’ll give you every advantage: tutors, enrichment activities, travel, the best schools. Whatever”. This is why you work hard, to provide advantages for your kids. I will give more of Sowell’s thoughts on education in next week’s letter.   
    Sowell laments what he sees as the spread of “The grievance culture to low-income whites—and even to Great Britain”. An idea has taken hold “that you’re entitled to certain things, you don’t necessarily have to earn them. There’s a belief that somethings wrong if you don’t have what other people have—that it’s because you’re “disadvantaged”.
    Joe Louis and Joe DiMaggio were 2 of Sowell’s heroes. He describes a moment in the 1947 World Series between the Yankees and the Brooklyn Dodgers. DiMaggio comes up with the Yankees behind and runners on base. He hits a blast that Al Gionfriddo grabs before it goes over the wall. “DiMaggio by this time is rounding second base. He gives a little kick in the dust and goes back in. That was the biggest outburst in DiMaggio’s career…I still remember that self-control all these years later”.
    RMD comment: My opinion of Muhammad Ali seems to be different than just about everyone else. He started the braggadocios, taunting behavior, which I believe has done a dis-service to society and athletes in general, and black athletes in particular. Prior to Ali, modesty was considered a virtue. Think of Nile Kinnick, Lou Gehrig, Musial and DiMaggio. After a home run, Mantle ran around the bases with his head down.     
    I first heard of Sowell in the early 90s, when he wrote a column for Forbes. He believed that people must be held responsible for their actions: he saw fault with our faultless society. Someone commits an armed robbery: it’s not his fault, he was raised in poverty, no father to look up to: he was abused. Sowell: the response must be immediate with no equivocation. That is wrong!
    Race and Culture: A World View. “Attempts to achieve through multi-culturalism, affirmative action, or other policies what can only be achieved by the development of cultural capital are illusions and distractions only likely to make matters worse”.
    Migrations and Cultures: A World View. “Each ethnic group has carried forth a particular set of skills, attitudes and lifestyles”.
    RMD comment: You are not prejudiced to state a fact: people are different. Many of the Italians who came to the US were masons or worked in mines (see below). The Hungarians and Bulgarians worked in the steel mills. The Irish were often policemen or firemen. For generations, Mohawk Indians have been the premier high-level iron workers, fearlessly walking on beams hundreds of feet above the ground (see below).
    In next week’s newsletter, I’ll review Sowell’s latest, and presumably last, book Wealth, Poverty and Politics: An International Perspective.     
    The stock of Collector’s Universe (CLCT) has been on fire. They started in the 80s as PCGS (Professional Coin Grading Service). By providing an impartial, hands-off grading service (they do not deal in the product), they standardized grading. They also issue a Population Report, saying how many items are at each level. The result was to unlock the value of the high-end material. Everyone wants the best, and they are willing to pay for it. Then came PSA (Professional Sports Authentication), which had the same effect on sports cards. Their latest venture is to authenticate autographs, which has been quite lucrative. They pay a 5.5% dividend. Notice the breakout to a new high on very large volume in February. CLCT is +23% so far this year.
    I spoke to a baseball card dealer I’ve known since 1980. He says CLCT has cornered the grading market on coins and cards, have been able to aggressively raise prices, and their autograph business has exploded. 

    RMD comment: CLCT has a micro-capitalization of about $230M. The average daily volume is 30K. Compare this to Bank of America (BAC), with a market cap of $235B, trading 106M shares/day, and Apple (AAPL), which trades 28M shares per day and has a market cap of $754B (the most valuable company in the world).
    This allows me to make several important points:
    1) Peter Lynch of Fidelity Magellan fame loved stocks like this that no one else follows. You actually can have an edge over the big boys.
    2) I have collected baseball cards since 1958. This is a perfect example of investment ideas from your daily life.
    3) Widely-owned stocks typically trade in penny increments: bid: 103.34, ask 103.35. This stock can be: last trade 25.57, with a bid of 25.40, ask of 25.75, a spread of 1-2%. You must put in a limit price and be patient. Because they are thinly traded, such stocks can be quite volatile. Also realize these stocks can be more difficult to sell than a widely traded stock such as GE.
    4) You must research investments for yourself. Don’t just take anyone’s opinion—including mine.     
    I had a handful of patients from the Macon area (about an hour north of Columbia) with Italian surnames. After I read Sowell’s book, I asked why their families settled in a small town in northern Missouri. “To work in the coal mines” was always the answer. One man was a relative of world heavyweight boxing champ Primo Carnera (Look him up on Google. Not much of a boxer, but an awesome physical specimen).
    When you look at something close, your eyes converge (come together). When you look at something far away, your eyes diverge (look apart). When you put your head down, the ground is always close, so your eyes converge. But: if you are on the edge of a cliff and look down, what you see is far away, so your eyes diverge. I read many years ago that this causes a natural fear reaction in almost all mammals: you don’t want to fall off the cliff. There is a reason for the saying “Don’t look down”. As I remember, mountain goats (and presumably similar species) don’t have this natural fear response.
    RMD comment: Dies this apply to Mohawk Indians? Is it why they are fearless high-level iron workers?   

    My father, John Arthur Doroghazi, was born 100 years ago, April 2, 1917. Joseph and Elizabeth (nee Biro (Bee-doh) translates from Hungarian as Judge) Doroghazi had 9 live births. Only Dad (born #3), Uncle Steve (b 1919) and Uncle George (b 1925) lived to adulthood. Causes of death included scarlet fever, diphtheria, and the great influenza epidemic of 1919.
    In the 70s, there was a public service commercial on the TV in the St. Louis area with a person holding a vial of DPT (Diphtheria, Pertussis (Whooping Cough) and Tetanus) vaccine. They said “100 years ago, parents would have given everything they have to get this for their children. Now people won’t get it for free”.
    RMD comment: I believe the British physician (who has since lost his license) that said there was a relation between vaccines and autism has done one of the greatest dis-services to humanity as anyone over the last 20 years. Vaccinations, along with the germ theory and sterile technique, are arguably the greatest medical advances in the history of humanity.       

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