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Saturday, December 26, 2009

Jason Kirby article in the MacClean's magazine about Derek Foster

Boxing Day is tomorrow and I am very excited. I finally be able to maybe shop for a winter boat and new jeans and some perfume from Body Shop and so on. My list is long, but I limit myself at 300$ in spending. While waiting for the fantastic day to come, I wanted to write on a topic that had been disturbing for me so far.

I appreciate Derek Foster 4 books. I went through this article a couple of weeks ago, someone at the name of Jason Kirby write an article in the MacClean. MacClean is a Canadian magazine – well-respected and so on. Well, MacClean’s magazine was a well-respected magazine until November 26, 2009, date where the magazine decided to publish on his Web site an article title “Lessons from the FALL: Some investors escaped unscathed. How did they do it?”. Jason Kirby article describe Derek Foster journey.

First, to answer this article question, I will say that I escaped unscathed from the stock market crash by following Derek Foster tips that he described in his books. I also escaped by respecting my very own believed. I am not financially very literate, but I believe in the stock market and in the power of Barack Obama on the economy worldwide. It’s the reason why I continue, on date of today, to invest and it’s exactly the reason why I didn’t sell my investment just to sell them.

The article “Lessons from the FALL: Some investors escaped unscathed. How did they do it?” of Jason Kirby is really unfair. One great Canadian had decided to share his financial knowledge to other and this is how the community is thanking him: by publishing an awful article in a national magazine. Until November 26, 2009, MacClean had been the voice of Canadian. But MacClean’s magazine is no longer what its use to be. While I was in high school, my English teacher makes us buy the MacClean’s magazine. We were reading MacClean articles in class and so on. But this was a long time ago and as you can understand, MacClean is no longer what it use to be. And as you notice, I need to refresh my English classes lol…

I am not talking for Derek Foster of course, but I would like to answer to some of Jason Kirby quotes, who seem to be pretty illiterate when it comes to Derek Foster work.

Here we go, let’s begin…

“With a net worth of about $1 million, and time on his hands, he turned to writing. And his books, with titles like Stop Working: Here’s How You Can and The Lazy Investor, suggested the path to retirement bliss was alluringly simple. Buy shares in leading companies that pay healthy dividends, he recommended, and hold on to them for the long haul.”

Nothing wrong with this part, Jason Kirby, so far so good. But just one thing: the path to retirement bliss is simple and easy. Sometime, the easiest things to understand are the hardest one to learn and understand. I know it myself, I had to read Derek Foster books multiple times before catching anything out. Maybe should you read them again?

After this part, Jason Kirby is simply loosing himself in the fact that Derek Foster, the buy-and-hold guy had sell all of his portfolio and so on. Well, I have a little something to add regarding this. Stocks had been made to buy and sell. When I set up my broker account at TD Waterhouse, I give TD Waterhouse a call and place this following request: to make it impossible to sell any stocks from my portfolio. At that time, the investment thing was all new for me and I wanted to find a way to protect my portfolio from fraud or from anything that could happen to it. I am a stocks and units collector, and when I am talking about my investment portfolio, I am not joking. The TD Waterhouse representative explains to me that it wasn’t possible to apply such hold in the account. The TD Waterhouse representative continue by saying that if something happen to one of the company I hold, that I might want to sell. Well, I have to say, that “something” unfortunately happens when Pengrowth Energy Trust (PGF.UN): announced a second dividend cut. At that time, I had a dividend income goal. And Pengrowth Energy Trust (PGF.UN): was going to ruin the whole thing. So I sell. And I made a profit out of the sell. It was fantastic. The point of all this is: stocks had been made to sell and buy. It’s an investment basic rule that I learn at the beginning of my stocks adventure.

Jason Kirby article continue with this very awful paragraph:

“If one were looking for lessons from the financial crisis, Foster’s U-turn would seem to offer plenty to chew on. Like don’t get wedded to any particular investing style. Or if you do, don’t panic when things turn rocky. Not that Foster, who just published his fourth book, Stop Working Too: You Still Can!, says any of that applies to him. He insists he didn’t get spooked by the crash, and says that bailing out near the bottom of the market, and then buying back in after the rebound didn’t cause him any grief, or even lose him any money. “I’m not any further ahead or behind where I would have been,” he says, thanks to a side strategy of buying put options, a complicated tool that lets investors bet on falling stock prices. Instead, the number one lesson Foster says he learned from the experience was not to share every investment decision he makes with the public.”

Derek Foster was honest enough to go out publicly with the fact that he had sold his portfolio. Myself when I learn about the even, I was all confused and I didn’t understand what it was all about. But in this investment game, the person who invest and decide to become an investor had to be very confident about him/herself. It’s all about listening to your feeling. I had been successful so for because I had followed my feelings and my feeling was to stick to what Derek Foster was teaching in his books. When I decide to sell my 600 and something units of Pengrowth Energy Trust (PGF.UN) a little while ago, I sell because another dividend distribution cut by Pengrowth Energy Trust (PGF.UN) was disturbing me and I really taught, at that time, that Pengrowth Energy Trust (PGF.UN) was going to loose some great values. So I sell. I sell because I belive in my feelings and like Derek Foster who sell his portfolio because he taught that the whole financial system was going to crash. I was wrong and Derek Foster was wrong too. Finally, Pengrowth Energy Trust (PGF.UN) didn’t loose any of its value, even after the company announced a second dividend cut. The financial system didn’t crash down.

Just to say that investment is a lot about feelings and self-confidence. Derek Foster had a good heart enough to go public with his decisions. The reason why is simple, Derek Foster know for sure that some people are trying to do the same thing as himself when it come to investment. But also, his books are bestsellers, so he had the responsibility to go public with his decision. And this was the right thing to do. Personally, I don’t think Derek Foster regret his move. His honesty will sooner or later pay off. I completely disagree when Jason Kirby say: “(…) the number one lesson Foster says he learned from the experience was not to share every investment decision he makes with the public.”

Actually, Jason Kirby article is all bullshit… lol…

But you didn’t read the most hilarious part:

“For everyone else though, the lesson should be blindingly obvious: don’t listen to anyone who tells you they’ve discovered the path to easy riches and a carefree retirement.”

I am partially blind from the left eye (if I cover my right eye, I can barely see from my left eye, got the picture?) , I don’t know if it’s the reason why I believe in Derek Foster strategy so much, but so far so good. I made enormous profit from my investment by following Derek Foster and I am not done. I am on the road for my first 100 000$.

Derek Foster investment picks are awesome. He is a good stocks picker. Better than Eric Sprott, from whom I only lost money with his Sprott Canadian Equity Fund. So when talking about Derek Foster, better be careful or I will come to the rescue.

Here another little thing coming from Jason Kirby:

“What’s worse, some Canadian investors borrowed heavily to buy stocks, a practice known as margin investing”

I read Derek Foster books over and over again. And guess what? Derek Foster the margin investing in one of his books, but I couldn’t tell which one. See, Derek Foster quotes are print in my heart and I know the content, I just cannot say what belong to which book anymore. But I have to say, Derek Foster clearly warn investor about margin investing. Derek Foster point of view about margin investing is clear: no one should use margin investing to invest in the stocks market. And guess what, I do not use margin investing. It’s too dangerous. If you want to invest, start from the bottom and fly right to the top with your own money. This is working fine for me.

In the second page of his article, first paragraph, Jason Kirby does not write anything about the fact that Derek Foster does not recommend margin investing. You want to know why? Because Jason Kirby is not a well-known journalism. Jason Kirby is not a bestsellers author or a well-known investor. But Derek Foster is. Could it be jealousy? It’s certainly is.

Jason Kirby end his article with this sentence: “Perhaps the best lesson to take from the fall is to simply remember that sooner or later, it will happen all over again. Will you be ready?

My answer to Jason Kirby: don’t worry about it, I WILL BE READY. I AM READY.

So now, time for Jason Kirby to recycle into something else than journalism and for MacClean to close their Web site and stop publishing their magazine. And time for me to take English courses;) And talking about English courses, did you know that Derek Foster had teached English overseas? Its actually how he met his wife. Isn't lovely?

Anyhow, it was about time to show the world the stupidity of MacClean’s magazine toward Derek Foster. But its now thing done.

Tomorrow is the best day of the year, it's Boxing Day and it's going be awesome! Happy Boxing Day! Shopping time!

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