Classic Carret-Common Sense from an Uncommon Man

Any man who follows solar eclipses around the world and was active on Wall Street for seventy years, should have a perspective on the market and life that is worth considering. This article presents selected quotes from Philip Carret on a variety of subjects.

Business Practices
“Let it be remembered that the accumulation of capital is hard work. It is worth burning a little midnight oil to study how best to keep it.” (1963)

 

Education
“Habits, good or bad, acquire an iron grip on human beings. All that the young need to do be assured of a good life is to surrender themselves to good habits, and flee from the bad ones. Easier said than done, of course.” (1963)

“Command of the English language more often than not often decides who succeeds among people of otherwise equal talents.” (1991)

“Failure can be a great educational experience.” (1991)

 

Evaluating Stocks

“If the management doesn’t own any stock, why should I?” (1998)

“The investor with a diversified portfolio should reexamine it at least once or twice a year, asking himself as to each item, “If I didn’t already own XYZ, would I buy it at the current market price?” If the answer is a resounding “NO!” perhaps it should be sold.” (1963)

“Most useful and most dangerous are the stock market averages, most useful in revealing the general trend of the market, most dangerous if they mislead the trader into forgetting that after all his profits depend on the movements of the individual stocks in which he deals.” (1930)

“Conceiving the speculator as manager of a business it will be seen that he also controls men, materials and money. The money is the starting point of his business, the materials are the securities which he buys and sells, the men are the directors and manager of the companies in whose securities he invests.” (1930)

“A corporation is a human creation and has many human attributes. Its life may be long or short, prosperous or the reverse. Sooner or later, in all probability it must die. The end of it existence may be sudden, the result of some hidden weakness, but in the vast majority of cases a corporation give ample evidence of financial ill-health before its dissolution or-to carry the metaphor further-a major operation occurs.” (1924)

“To consider stocks by groups rather than by individual companies is further to ignore the vital factor of management.” (1930)

“The investor, or investment advisor, who so lacks confidence in his own judgment that he won’t buy any security until it is favored by the consensus of the investment community, will buy few bargains and is unlikely to achieve results to which he could point with pride.” (1969)

“Everyone has an occasional bad day and it is utterly unreasonable to expect any company to chalk up new records quarter after quarter.” (1972)

 

Evaluating Bonds

“Income producing real estate is fundamentally the best kind of security for a loan. Real estate is the only essential to every human activity.” (1924)

“Foreign government bonds are all alike in one respect. Whether the borrowing government be Ecuador or Great Britain the lender, or bondholder, enjoys no real security except the good faith of the borrower.” (1924)

“A safe bond is merely on that is certain to be paid when due. The actual price at which it may sell at a given time, taken by itself, is no indication of safety. The price of a safe bond may fluctuate very widely.” (1924)

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