Arwin had the emotional balance of a roller coaster. His highs were near euphoric and his lows would typify him as a manic depressant. Despite his imbalance, Arwin sought life ventures wrought with uncontrollable variables. He worked as a mortgage broker and by nature of the industry his business often lived and died off of the Federal Reserve’s opinions on current interest rates.
A saving grace for Arwin was that he was married to an accomplished biophysicist who actually was brilliant and broadly recognized as a leading expert in her craft. She also happened to be a deep introvert, having a small supply of daily words that needed to be used. This meant that Arwin was accustomed to having cash to spare and a captive audience. The excess income paid for new homes, new cars and it supported his favorite hobby, the buying and selling stocks. In a bull financial market where the rising tide raises all ships, as well as investment portfolio balances, everyone thinks they are an expert trader. Arwin’s successes during the late 1990’s were representative of the massive market increases fueled by the unprecedented growth in technology stocks and newfound startups. The market was euphoric and investing caution was tossed overboard. It was during this time that Arwin became self-aware of his destiny to become the next Warren Buffett, the famous investor known as the Oracle of Omaha.
The annual Christmas party put on by Stephen’s employer brought together a cross section of industry types who had an interest in financial discussions. As a byproduct of the festivities, the event would frequently become the platform for Arwin to deliver his annual report to attendees; whether they wanted it or not. Stephen would quietly entertain himself by watching Arwin arrive and immediately begin to gather party guests for his report.
“Hey Sammy! Good to see you. Say, did you get in on that natural gas company I was telling you about?” Sammy, someone who was still used a pager from early 1990’s, would give an apologetic look as he tried to piece together a conversation he and Arwin apparently had several months beforehand.
The moment’s hesitation was all Arwin needed. “Ah, probably not. That stock looked pretty scary at first but those of us who had the gumption, got the reward; know what I mean?” He would toss a deviant smile and a nod before moving on and setting his sights on another unsuspecting prey. “Hey Philip! How’s your Merrill Lynch guy doing for ya? Still paying those red hot commissions for ice cold stock tips?”
For all his outlandish claims, many attendees would still fall into the trap of believing they were witnessing the reincarnation of Buffet’s mentor, Benjamin Graham. It was generally accepted by those more aware to observe the show from a distance, where one could remain cautious to not be mistaken for an Arwinian disciple. The entertainment of watching Arwin’s nauseating reality show routine was part curiosity and part hilarity for Stephen. He enjoyed the audience’s dramatic expressions of curiosity and wonder as Arwin bragged perpetually around his latest stock picks. He chuckled as the man would go on and on about the level of research he did and the “gut” feeling he so wisely acted upon despite a stock’s low reputation by the “so-called” analysts and the collective investment community. The whole conversation would amount to little more than a mental massage as the aspiring portfolio manager stroked his own ego for all to observe and marvel. He was quite content to elaborate to any unwitting audience who could be pulled in by a false hope of obtaining the slightest tip which would somehow perform an overnight transformation of their ever-lagging portfolios. Arwin didn’t care what happened to their investment portfolios, his only intention was to feast in the moment of their adoration and swim in their praise of his brilliance.
After a couple years of watching the routine, Stephen had learned that the bragger never revealed any indication of the amount of risk he actually took with any of his investments. The young oracle had been more than generous to discuss the infallibility of blending his keen observation skills and intuitive analysis along with his rare risk-embracing, edge of the cliff, daring personality. But in an offhanded conversation with Arwin’s wife one year, she casually let Stephen in on her husband’s secret. What Arwin would not discuss about any of his investments was how a pending confirmation screen for a stock purchase would routinely drive fear through every nerve in the oracle’s body. In response, he anguished to make a trade and always trimmed a couple of zeros off the investment amounts before submitting them; a glaring representation of his true self-confidence; or lack thereof. Stephen learned that despite the grand talk, Arwin never let his awe-inspired audience know that the cumulative investment in the high-flying success stock was little more than a tenth of a percent of his overall portfolio. It was extreme bungee jumping, but without the extreme, or the jumping, and probably more like looking at the bungee cord still wrapped in a box. Yes, the massive risk taking investment adventure taken by the “Oracle of the Christmas Party” was usually a transaction which may have succeeded in adding about $500 to his household net worth.
Congratulations sir, Warren would be proud.
Eventually, as though the cyclical nature of economic reality should be unexpected, bull markets gave way to bear markets and stock values fell. No matter how sound a financial strategy might be, the majority of investors were calling their financial advisors to ask how they could have possibly lost money. When it came to over-the-counter penny stocks whose volatility and risk exposure was often more than twice the level of broad markets, their fall would quickly become more of a plummet. Ironically, it was during those years when Arwin had conflicting plans and could not make his company’s Christmas party.
Similar to the investment heroes like Arwin, Stephen surmised that there were plenty of braggadocios runners who had stories which sounded more like, “I threw up my breakfast, hit my head on a curb when I passed out, talked to leprechauns, and eventually ran slower than I could have walked.” He hadn’t heard anything like this but it figured that the owners of those stories probably kept their mouths shut and never mentioned the time they tried to run a marathon. There had to be plenty of Arwins out on this course today.
This serpentine thought process provided Stephen with a temporary distraction from the frustration of being smothered by other runners, which had been mere speed walkers among the congestion. As pockets of air began to form between the runners, strides began to lengthen and personal space began to resemble a commonly accepted courtesy. He pondered the type of race he was in for? Would he talk about it or try not to mention it or hope somehow it got lost among the sea of topics that weren’t significant enough to remember. The Rookie felt frustrated, nervous and excited all at the same time.