저자: PeterLynch · 외국인
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피터 린치는 개인이 자신의 산업 지식과 일상적 경험을 활용해 종목을 고르면 유리하다고 강조한다. 금리·경기 등 거시 예측은 불가능하므로 이해 가능한 기업에 집중하라고 조언한다. 상승 가능성이 있는 기업 실적에 주가가 연동되므로 장기적으로 이익 성장 기업을 보유하라는 입장이다. 자본이득세 인하와 소기업 육성이 경제에 필요하다고 주장한다. 방송 시점(1993년경)의 경기 견해로 독일·일본 침체 속 미국 경기 회복을 전망하며 경기민감주(제지·알루미늄·철강)를 언급했다. 특정 종목 추천은 아니라고 선을 그었다.
다듬은 글
We begin with Peter Lynch. Time magazine has called him America's number one money manager. During the 13 years he headed the Fidelity Mellan Fund. It was a top ranked general equity mutual fund. His new book, Beating the Street, offers advice on picking stocks and maximizing profits. And he's here to talk to us about a lot of things, including his own dramatic decision.
Uh what, four or five years ago, Peter, welcome to the broadcast. Four or five years ago, you just said, "And I'm managing all this money. I'm going to do I'm going to quit. I'm Yep. That's right. And what?" And you went to do what? Well, actually I wanted to spend more time with my wife and my children,
right? And it it was an interesting situation because I loved my job. I adored my job and I and I liked outside activities. And when I when I was young, you know, I didn't wasn't involved in charity work until I was 30. No activities. Younger children, you just read them a book and Good Night Moon and they fall asleep and it's all over.
When they get older, this there's more time involved. So I enjoyed the family. But I was I was leaving for work at 6:00 in the morning. I was getting home at 7:00 at night, 6 days a week. This was in Boston. Yeah. Traveling 14 days a month. It was just too much. So I said, you know, I I said, "That's it.
I can't take it." And fortunately, I had made enough money to say I could give up the job. I didn't have to give up with the family or the outside activities. And so what happened then? So you did what with your life? Well, I cut back from about a 80 90 hour week to a 40 or 50 hour week. And I in the morning I make breakfastes and lunches for the kids and I do the spelling words and the Spanish words.
And Carolyn does the math and the science. And I uh see Carol in the morning and off I go to a place. You have to go. So in my opinion, you have to go somewhere to do something. If you stay at home, you wind up answering the telephone or watching cartoons. So I uh or falling asleep, taking a nap. So she does the hard work and I go I go Fidelity gave me an office.
I have a secretary and I spend majority of the time working on charity things like inner city schools, inner city libraries, inner city housing, you know, helping people manage their money or help. No, not at all. None of that. Just I'm some of the charities I'm on the investment committee of of some of the museum of fine arts.
I'm involved in Mass General Hospital and Boston College, but United Way, but the all the extra things I added to were real hands-on actually being involved in charitable activities. You wrote a book called One Up on Wall Street, and I think that's one of the bestselling books ever about Wall Street if I'm not correct.
You can correct me. And so, so why then did you write another book? Okay. Okay. First of all, I was very lucky. I wrote it with John Rothschild. He was he was made, he made a big difference. See, but I think the reason I wrote it is the fir I tried to explain to people their great advantages, their edges they have
and that they should get involved in stocks and they should do it on the right basis. This was on the first book, right? Yeah. And obviously I didn't make a great impression because the percent of people's assets involved in stocks has gone down. In 1960, people had 40% of their financial assets including their house in stocks and mutual funds.
In 80 that was down to 25%. It's now down to 17%. And why do you think that is? Well, I think people in the decade of the 80s was the best decade this century for stocks. I think people managed to lose money in the 80s doing it themselves because their methods were so flawed. So, I I really feel as though I wanted people to understand I don't want anybody to buy a stock.
I'm saying if you're going to buy a stock, you should do certain things. If you're not willing to do these things, you should leave your money in the bank. Your your philosophy is is simple and I'm remembering this from the previous book. I think we're now talking about the previous book. Correct. Your philosophy was if you find something that you identify with.
I remember there was a story of your wife and her hose. Your wife kept saying, "Oh, you got the legs and pants." Your wife said, "These are the greatest things I've ever seen." And when your wife said that, you knew that this was a product that was better. You used to stay at Laquenta Motel and the service was better, whatever was better.
And the price was good, too. And you said, "This is a place that I can determine. I, Peter Lynch, can tell that this is a good product." Right? If these people making a good product, then their earnings are going to go up. Therefore, the stock's going to go up. And I that's the kind of decision-m process you ought to go through.
Right. Do I have it? You've got it exactly right. Well, I do I don't think people understand there's a 100% correlation with what happens to a company's earnings over several years and what happens to the stock. If the company McDonald's has done very well as a company, right, the stock has done very well.
People worry about too much money supply, what's happened to the price of oil, whe who's the president, who's being nominated for the Supreme Court, the ozone layer. It has nothing to do. McDonald's earnings go up the next 10 years, the stock will go up. Yeah. But what they will say to you, Peter, is that, as you know, and why am I telling you this, but it's fun to tell you this.
They're telling you that these other things influence the amount of earnings of a particular company. If we're in a recession, people are not going to spend as much money on going to the movies or whatever they do, right? and and therefore you got to pay attention to these other things because they impact on earnings.
They are very important but you have no idea of knowing what they're going to do. Alan Greenspan's the head of the Federal Reserve. He cannot predict interest rates. Yes, he'd be the first to tell. He can influence it, but he can't predict them. He cannot predict what long-term interest rates are going to be one year from now, two years from now, three years from now.
He's even surprised how low they are now. Right? So, how am I supposed to predict interest rates? How am I supposed to predict the economy? You certainly remember the recession of 82. 1982, we had a 20% prime rate, 14% unemployment, 12% inflation. I don't remember anybody telling me in 1980 or 81 that was going to happen.
All of a sudden we had the worst recession since the depression. I didn't read about in the paper. So it's crazy to think about these things. Here's a quote from you. I own Dunkin Donuts. When you own Dunkin Donuts, you don't have to worry about Korean imports. You don't have to worry about M2 or M3.
These are money supply figures, aren't they? And and what's happening to the money supply? This is the way you make money. If you don't understand what the company does, you should not be in it. If you could predict the stock market, you could predict the economy. You could predict interest rates. If you go buy the wrong stocks, you're going to lose half your money anyway,
right? I I'm saying people have natural advantages. Yeah. Let's say what you do for a living is you're involved in the restaurant industry, right? You supply paper products. You supply kitchen equipment. You help build restaurants, right? You saw McDonald's, you saw Chi-Chi, you saw Chili's, you saw Cracker Barrel, you saw Dunkin Donuts, Kentucky Fried Chicken, Taco Bell.
These stories, these were 40 40fold. You made 40 to 50 times your money. You don't need to make that kind of money many times your life, right? No. That's all you had to do was follow the restaurant industry. People are in industries. They're in the publishing industry. They're in the chemical industry, the paper.
Why don't they just stay with that industry? You only need a few stocks a decade. How many good stocks you need a lifetime? Instead of people that are in the restaurant industry, they're buying biotechnology stocks. The people in the chemical industry are buying oil stocks. It's absolutely absurd. People don't understand their natural advantages and they don't use them.
So that's that's bad number one. But worse number two is they don't if you don't think you're a good ice skater or if you're convinced you're not a good chist, you're not going out and try it. But people are buying stocks anyway. They're not discouraged. They just think it's a gamble. So therefore, they go forward and they they bet on one stock for a week and a half and it goes up and they they make $2 on it.
Then they sell it and they buy something else. When three years is over, all they've done is generate a lot of commissions. They've probably lost money. That's a mistake. So your advice is what? If you don't understand a company, if you can't explain it to a 10-year-old in two minutes or less, yes, don't own it.
Because when it goes down, let's say the stock goes down two points, you won't understand what's going on. What do you do? Do you buy more? Do you do you do you flip a coin? Chances are your broker doesn't either. You they he or she certainly doesn't know about it. I mean, who knows what advances what all these things are at auto back planes and mega flops.
Who knows what all these So, buy what you know. Buy in your industry. Buy what you know. Buy local companies. Yeah. So So suppose you you don't have an industry. I mean, you know, you don't really Well, you buy local companies, companies in your own industry. 10 years after Walmart went public, 10 years after it went public, 10 years after it went public, it's a 25-y old company now,
right? You could have bought the stock and made 50 times your money on it. 50 times. So, if you bought it 10 years after after it was public already, it already gone up fivefold. So, you could have made 250fold. But I'm saying, let's say you were in a town, they came into it and they said, "Boy, these prices are great.
They're doing terrific. I like the bargains." And you checked it out. You spent a little bit of work on it. Yeah. I mean, people are very careful. They when they buy a dishwasher, they do some research. They'll put $10,000 in some stock. They're here on a bus. So, if you did a little bit of research, you say Walmart's only 10% of the country.
They're not even saturated there. Why can't they go to the rest of the country? So, is this this is more of the same? Is it what it is? It's more of the same. Plus, I show examples. It's it's a a touch more detailed. This actually shows me in action. I picked 21 stocks early in 1992. Some work, some don't.
I follow those companies. Some of the companies the fundamentals deteriorate, some they improve. I watch those companies go through the year. I also explain the retail industry. I try and make it very simp. I talk about a wonderful example is a seventh grade class. Yeah. The teacher of that read my book and my first book that you were talking about.
You you and I did a show on that in Washington. You remember that show? This is a long time ago. She read the book and I said, "If you made it through fifth grade math, you can do it in the stock market." She says, "Okay." She started teaching it in seventh grade, seventh grade class. These kids had to study companies.
They had to look at their balance sheets to see if they're solvent. And they picked stocks. These stocks were up 69% over two years when the market was up only 20. And they picked stocks like Limited. They picked the Gap. They picked Walt. They understood these companies. They also picked IBM. I lost money on that, too.
I mean, everybody makes mistakes. Everybody did. Yeah. But I'm saying this is this was this was a school St. Agnes school in Arlington, Mass. But in addition, in the decade of the 80s, there's 8,000 investment clubs. These are amateur sort of right average people just investing. These investment clubs, 62% of them of these clubs beat the market.
In the decade of the 80s, only 25% of professionals beat the market. Let me go back to one other subject. You after you're coming back to Fidelity, aren't you just aren't you going to do something? Well, when I when I finish this book, I've been working about one or two days a week the last year and a half on this book.
Right now, I'm done with the book. I'm gonna go back to maybe one day a week working with the younger analysts just listening to them talking to them. I'm not telling them to buy zero sell lifestyle. Not totally. I'm not gonna run another fund. 13 years was plenty of running a fund. I'm just going to work with younger analysts.
Let them ask questions. I'll ask them questions. It's going to be a lot of fun. Now, do you still follow Do you manage any money for anybody other than yourself? No. No manage I manage money with other people for some charities, right? But no, I don't manage anybody's accounts. You're not doing some mutual fund, some pension fund.
I'm out. went cold turkey. All right. Cold turkey, didn't you? Cold turkey. Now, are you happy you did this? I mean, obviously, I'm delighted. It's great. And you like your new life? Oh, it's fabulous. Let's talk about the Clinton economic plan. What do you think of it? Well, I think his theories are excellent.
You know, we clearly Which theories are excellent? Well, he claims that we're going to do more investing and less spending, right? And that statement you can't argue with. Less consumption, more saving. You absolutely have to invest more in education. You have to invest more in companies. You have to invest less in just spending money.
I mean today people are encouraged to spend. You spend money. Let's say you put an addition on your house. You spend money on that that you can get a tax deduction because because the interest on it tax deductible. If you invest if you take your money and put it in the bank, you're taxed at a very high rate.
They have this incredibly unfair term. It's called unearned income. When you every time I do all income taxes and I fill out the the number for what you made the money you put in the bank, it's called unearned income. What a it's it's an insulting term. But anyway, if you if you buy a stock and you make money on it, you pay a 28% tax on it.
Yeah. Guess what the capital gains rate is in Japan? Uh capital gains rate in Japan is 10%. Zero. Zero. Right. I mean, we're not encouraging people to save. We're not encouraging people to invest. We're encouraging people to spend. You're in favor of the elimination of the capital gains tax that that Bush
reducing it or eliminating it. And I'm glad that Clinton didn't raise it. I mean, he raised other taxes. This fairness thing, I understand. And and what about this tax the rich business? You you buy that? I think fairness, it's a debate. What's fair? I think I certainly think raising taxes is appropriate.
If it's same time you cut the spending, it's a lot easier to raise taxes than cut spending. If we can cut spending and get government's share of the gross national product reduced, it'll be fair. But our country works very well. It's working extremely well. I mean, you just don't want it to get spin out of control.
You don't buy into the stimulus package that don't buy into that at all. You believe that we don't need to go out and create jobs. Charlie, we we've had eight recessions since World War II. We've got out of every one of them. This is number nine. There's nothing unique about the system. We'll get out of this one.
In the decade of the 80s, the 1980s, we added 18 million jobs in the United States. Yeah. But but soon as you say that, as you know, people are saying, "Yeah, Peter, but look what we did. When Ronald Reagan came to the White House, the deficit was what, $70 billion? 6570 billion. And now it's approaching $350 billion.
And the amount of money that we have to spend to pay off the interest on that debt is saddling us and destroying us and destroying what we agree. You're right. I I agree with that. Don't tell me how many jobs we created in the 1980s because you can always create jobs if you're willing to. No, that the government didn't create that,
right? The 500 largest companies in the 80s eliminated 3 million jobs. Eliminated 3 million and we added 18 million. These 2.2 million businesses started. 2.2 million businesses started in the 80s. Now some of them didn't make it but if an average they have 10 employees today that's 22 million jobs what the only thing that creates wealth the only thing that creates taxes to pay for all these wonderful things is jobs there is something magic about jobs and jobs come from companies starting
that's what I was trying to say small companies create jobs small create all the jobs right so that's what I'm talking this is not voodoo economics this is the real thing you have to encourage people to take some risk to put their money out and go start a business it's a risky proposition and you do that by what kind of government policies other than a zero capital gains or a 10% capital gains.
Lower interest rates. What's the capital gains at now? 20 28% plus. It's the highest capital gains rate we've ever had in the history of this country. It's never been this high. I mean, it's terrible how high the capital gains rate is. That's not encouraging people to invest. What you want, you want to have lower say, you want to have lower interest rates, lower paperwork.
People start a business now, they have this much paperwork to fill out on regulation, they go crazy. That's crazy. You got to cut that out. Yeah. Oh, well, okay. But I mean, some If people without those kind of regulations then people would be creating dumping into the rivers and and not protecting the environment regulations not protecting the health of their employees.
I mean look what happened down in my home state of North Carolina because of you know the fire they had down there. I mean people say if you don't have some kind of government regulation and companies aren't doing their job to protect their workers then this is not the kind of society. Some of these regulations relate to the size of your paper clips.
I mean there's a lot of wasted and some of this paperwork is mind. Sometimes you could do it with one piece of paper. That's it. I mean that would be a good policy. I think Clinton, it really wants to make it work. The capitalist system works. Obviously, you want to protect the consumer and and business people carried to extreme when the oil monopoly and the steel monopoly that's wrong, too.
I mean, I think trust should be broken up. There is a role for government. IBM, what happened to them? IBM had a wonderful business. They used to go to companies like Fidelity, Chase Manhattan. They used to come and explain to these people how to use computers. Yeah. They didn't know how to use computers.
Yeah, they went to companies and went in with very talented, experienced people, IBM, and explained to people how to use computers. Today, all these companies like Johnson and Johnson's, American, Bristol Myers, they have people in the company already that know computers backwards and forwards. The same IBM people walk in with these solutions.
They don't need all those people. So, all these companies took IBM's business away from them. No, no, they do internally. They have experts internally now that are trained in I it's called now management information systems. They all have all these fancy acronyms for it. They have skilled people. All they want now is software and a cheap box.
They don't need all these. So IBM was dealing in a system that was very effective for three or four decades. Now the technology has moved to the chip. The technology has moved to the software. It's not the box. It's not the storage device. So what should IBM do? What should this board of directors of IBM which is looking for a new chief executive officer?
What should they be looking for? people saying they ought to just Mort Meerson the number two guy to Ross Bau down there said maybe they ought to dismember the thing or maybe they ought to create all kinds of little entrepreneurial companies from within break it up they'll eventually they have incredible technology they're very skilled they have a lot of determination
right now unfortunately it's sad they have too many employees they have too many factories they try to do it all themselves they're they're they're working the right direction I mean there's nothing wrong with the direction they're going they will turn it around they're in a hard process because the the technology is advancing all the time.
What was the genius of Bill Gates and Microsoft which now has a higher net worth than IBM, doesn't it? Well, he there's a lot of bright people. Oh my god, his he his net worth alone might be more than IBM's profits. I mean, you might him individually. Yeah. Yeah. His brilliance, a lot of brilliant people
and he had a lot of luck. IBM adopted MS DOS is the operating system. They rushed to the market with the first computer. They need an operating system and he had the only one. If they'd waited a couple years, they could have used their own. So MS DOSs became the basic operating system of every computer, whether it was a compact computer.
The only computer system that didn't use it was Apple. Apple had their own operating system. So every computer that went out there all over the world needed MS DOS. He uses used that to come along with Windows. So he was there. He was like the the gasoline when people whatever car if you had all if you had if you had the rights to all the gasoline, you don't care whose cars.
Or set another way, I mean IBM was making all of these razors and they and he was making all the razor blades. You got it right. Yeah. Absolutely. And then there were other people making razors to use his his blades. Exactly. He had all the razor blades around. No, obviously he's a bright person. And and rich.
Yeah. And EDS EDS, you know, Ross Perau. Think of Perau. I think he's a well-meaning, talented guy. He's done a lot of good things in education. Did you vote for him for president? I did. You did. Perau was your guy? Yep. I sure did. Why? Well, it was sort of a protest vote because I know in our state, you know, I mean, in our state, yeah, I know in Massachusetts the Democrat was going to win anyway.
And I really thought his concepts of cutting down on the deficit and more investment. Ah, cutting down the deficit is a good idea. Oh, it's absolutely a good idea. It's a terrific idea. Give me five good stocks to watch, not to buy, but just to watch. Five ideas that you think where people are really on the right track and created a good business.
Well, I think not touting stocks, America. I just want to know what Peter likes. Okay. Well, we have a company in Boston called Oba Pan. It's It's a company that makes croissants and they make breads and they have a state-of-the-art bagel they're working on. I can understand that company. They're only in about 20% of the country.
They're starting to roll right now. It's I think you know the price is fully priced and I think now is the time. What's it selling for? What's fully priced? Oh, I mean it's 25 times next year's earnings. I mean that's very high. But I think over the long period of time I'm hoping the market goes down and the stock will go down and I'm going to back up the truck and buy a lot of shares.
I think now's the time to look at cyclical stocks. I think the economy is going to get better around the world in '94. It's already getting better in 93 in the United States and even better in '94. Better in 94 because right now it's slumping in Germany and it's slumping in Japan. So I think now is the time to look at cyclical companies in the paper industry, the aluminum industry, the steel industry.
They've cut the costs. They're the lowest cost producers in the world and when things get better, they're going to make a lot of money. What about little small companies we should look at? Oh, there tens of thousands. Name one small company. Well, I guess I'd say OA pans a small or another one would be Jay Baker is a relatively small company.
It's a retailer or Super Cuts. They do haircuts. That's a small company. Peter Lynch is back with a new book called Beating the Street. It is always interesting to have him here. Uh what up on Wall Street was one of the better bestsellers uh ever to about Wall Street and it is very simple which most things are very simple.
Uh and when you understand them, you can understand uh what makes the world work. I appreciate you being here.
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