Matt Gornick

Become Smarter: Audiobooks and Podcasts

Posted in Financial, Personal by mgornick on June 20, 2008

Audiobooks and podcasts are a relatively old technology, but surprisingly I just began using them to better myself.  Just this week, I found myself doing nothing on my daily commute to work.  I spend about 30 minutes total composed of walking and train travel.  During this time, I would usually have only a fraction of the time to flip through “The Wall Street Journal” each morning.  Here is where my idea came in.

I just started to download a few podcasts (listed below) and listen them on the way to work.  This keeps me up to date on the most recent news and culture for the day/week.  So far, I have been enjoying receiving my information this way because it is extremely focused in the particular topic and it allows me to make use of my daily commute.  For instance, I can get the top headlines as well as recent news pertaining to the stock market.  To be successful, you need to be aware of the culture, world, and events around you.  Soaking in the news via a podcast each morning is a quick and easy way to make use of your commute.

Additionally, I found that Librivox.org offers free public domain audiobooks to download in mp3 format.  I’ve been getting through a few books simply by listening to a chapter or two on my way to work or while I’m relaxing.  Yes reading can be relaxing, but for those who are crunched with time an audiobook is a great substitution.  Additionally, you will be (or at least seem) more worldly and understanding to the classics when talking to your friends/coworkers/date.

I’ve outlined some of the recommended podcasts and audiobooks to get started!

Podcasts:

1. The Wall Street Journal Podcasts: “What’s News” and “Tech Headlines”.  If you have a 30+ minute commute I would recommend their “This Morning” podcast as well (but its usually ~35 min).  The WSJ is the quintessential source for financial and market news.  If you don’t listen/read it, you’re missing out.

2. The New York Times: “Front Page” and “World View” for a different perspective on the news.

3. (Your favorite news source or another podcast of interest if you have extra time)

Audiobooks:

1. The Prince by Niccolo Machiavelli:  Written by a Renaissance hilosopher, The Prince is timeless novel that digs deep into how a ruler, company, or CEO should serve and rule his domain.  If you are interested in Investment Banking, Mergers and Acquisitions, or start-up takeovers this book is a must read!

2. Pick a book from: http://www.lifehack.org/articles/lifestyle/getting-away-from-the-daily-digital-noise-a-list-of-time-tested-classics.html

3. Or http://artofmanliness.com/2008/05/14/100-must-read-books-the-essential-mans-library/

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AAPL on Goldman’s Conviction Buy List and Apple’s Success

Posted in Financial, Uncategorized by mgornick on May 23, 2008

According to a Reuters article, Goldman, Sachs & Co. has added Apple Computer (ticker AAPL) to its Conviction Buy List.  According to GS Global Investment Research this means that Apple’s addition “[represents] investment recommendations focused on either the size of the potential return or the likelihood of the realization of the return.”  It may be a good time to purchase some shares of AAPL prior to WWDC in early June, where a new 3G iPhone and updated iPhone software are rumored to be announced.  They are increasing distribution to foreign countries as well as chipping away at Research in Motions (ticker RIMM) market share in the smart phone market.  Apple has captured 28% of the US smart phone market in such a short amount of time; newer devices, possible subsided prices, and developer applications will only propel the devices adoption into the masses.  The question I ask is why is Apple so successful?

Including Apple to a list of successful companies is a given.  The stock is up over 3,500% over the past decade and over a 1000% from 2001.  For may of their products they weren’t the first to come to market; they were the best.  This can be seen in their lines of iMacs to iPods to iPhones.  Today’s society has benchmarked them as hip, creative, and energetic.  Purchasing a competing product today is considered a social faux pas.  Apple’s marketing is genius; they make the best products and allow for competing brands to “attempt” to design comparable devices.  The smart consumers choice is simple, pick the product that the most people will associate me with “being cool”.

To expand on Apple’s strategy, they produce the best products.  Comparing Starbucks to Apple, they both create new products/services in a seemingly congested market.  The difference is that Starbucks’ competitors create knockoff products that are just as popular whereas Apple’s competitor can produce a technically similar product that can’t sell.  Take Microsoft’s Zune where it has similar design, similar features, similar price and yet people don’t buy it.  Gamestop is fazing out the device which for which ” Microsoft has sold only 2 million Zune’s since it launched the device in November, 2006. Apple, in contrast, sold 10.6 million iPods last quarter.”  The reasoning is simple, to be cool you need to buy an Apple product.

Apple has an addiction to finding what is wrong with current technology and media and turning it into something that people will love and covet.  They are reshaping the cellular industry and are on the cusp of changing the way people and technology interact.  Despite the lack of vigor into Apple’s home entertainment, they will be the leading provider of legal digital content being delivered to the home in a short period of time.  Not that they haven’t captured over 70% of legal digital music sales and surpassing Walmart as the leader in music sales, its that the market isn’t ready for such thorough integration of media into the living room.  Apple TV will bridge the gap for now, but I would not be surprised that Apple has other devices up their sleeves to meet the changing market in a few years.

Apple prides itself on cutting edge innovation and breathtaking design.  Their success is rooted in the fact that they look for problems with today’s technology then build tomorrow’s solution.

 

References:

http://www.reuters.com/article/companyNews/idUKBNG29300420080523?symbol=AAPL.O

http://www2.goldmansachs.com/research/rating.html

http://www.macdailynews.com/index.php/weblog/comments/15363/

http://arstechnica.com/journals/apple.ars/2008/02/05/iphone-owns-28-percent-of-us-smartphone-market

http://www.washingtonpost.com/wp-dyn/content/article/2008/05/23/AR2008052301323.html

Changing Starbucks: Schultz Second Act for Success

Posted in Financial by mgornick on May 19, 2008

Starbucks has had its chance at being one of the most popular and recognized coffee brands in the world thanks in part to Howard Schultz.  In the past few years, Schultz has been a Chairman at Starbucks and let another person take the CEO reigns.  With no suprise, Schultz has returned as the CEO and his goal is simple: “[transform] coffee from a commodity into a social experience.”  Now is the perfect time, as its stock, NASDAQ:SBUX, once brewed at $40 and now is a sour $17 and yearly earnings are meager.

Is it time to buy SBUX stock?  Not yet.  The US is in a recession and people, more specifically the younger wealthier generation of customers that they target, are spending less on luxury goods.  Eventually, I know SBUX will regenerate its growth and appeal due to Howard Schultz’s style and taste for success.

Looking at Mr. Schultz’s day in a Fortune Magazine interview, he “gets up between 5 and 5:30, and naturally the first thing [he does] is make some coffee … At work the first thing I do is read the flash report, which is our roadmap of what we do that day. We manage day-to-day in our business. I’m proud that we are so nimble — we have great information flow to make that happen.”  Starbuck’s flash report is very similar to the JP Morgan Secret to Success story, I posted about earlier.  It doesn’t surprise me that knowing what you need to get done and executing it leads to success.  I would bet that Schultz has a list of things he wants SBUX to accomplish in the near future and eventually long term.  This allows himself and his colleagues to prioritize, organize, and execute.

Another positive trait trait for success that Mr. Schultz displays is the ability to change and adaptability to new trends.  Starbuck’s wants each cafè to have a local feel and community design, hence the social experience.  According to the Wall Street Journal, an employee from Long Beach, CA complained that he could produce better artwork than what was being displayed at the local Starbucks.  Schultz response was to “put his own pictures up … Don’t ask for permission; ask for forgiveness.”  This mentality of execution without the hand holding of upper management will allow Starbuck’s to create a local community of art, coffee, and social gathering.  The particular quote of “Don’t ask for permission; ask for forgivenes” is powerful in the sense that to be successful, sometimes you need to delegate work and trust your employees.  This is true for any startup; if you insist on doing everything and double checking your friends/employees/partners work then you will be too slow to take on new trends in your industry.

Schultz has the right idea to turn Starbucks around and has the proper lifestyle for success.  He was quoted for saying that “he was just depressed … and [in turn] launched a personal turnaround routine, consisting of what are now six gym workouts a week and a daily health shake of fruit and cottage cheese.”  Healthy lifestyle, wakes up early, makes his list of things to do; sounds like the makings of a successful person and a changing company.

References:

http://online.wsj.com/article/SB121115607637802259.html?mod=hps_us_pageone

http://money.cnn.com/popups/2006/fortune/how_i_work/frameset.exclude.html

Stock Market Investing

Posted in Financial by mgornick on May 18, 2008

Investing in the stock market is one of the smartest or dumbest moves you can make.  A lot of people, myself included at times, have a difficult time making decisions or making dumb ones.  For example, Visa IPO came to the NYSE a few months ago.  I was looking to buy some shares pre-IPO for ~$44 per share.  I passed that up, as well as $54, $64, $74.  After roughly doubling, I decided to buy some stock in the mid-80’s.  

If we all were economists, this wouldn’t be a problem.  I was making a rational decision based upon the knowledge I had at the time and choose to hold my money instead of risking losing it.  The risk of losing my money simply outweighed the risk of investing and hitting it big.  This is the problem, I always say that the money you invest into the stock market should be considered as lost.  Yes this is horribly pessimistic, but it puts you in the mind set into how much risk you are willing to take on: “only invest what you are not afraid of losing.”  If I had followed my own recommendations, I would have doubled my investment.  Instead, I took the irrational of the two choices because I choose to wait with my purchase.  

For my future stock purchases and sales, I don’t want to encourage acting on impulse, but a certain degree of risk should be assessed and acted upon before an opportunity is lost.  If I was to by a $100 dollars worth of stock and I was unsure, I should invest half and hold the $50 for a future purchase date.  This mentality will allow me to take on more risky investments as well as maintain money to buy future investments.  Next time, I will pick the “rational” of the two decisions.  

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