Rule #1 Finance Blog

With Investor Phil Town


Phil_town_116 My publisher, Crown/Random House, just sent me the first magazine
review of Rule #1.  Publisher’s Weekly is the book industry magazine.

They publish weekly as you might have guessed and they review about 140
of the 5000 books published that week — so getting reviewed at all is good.

Out of the 140 they review, they give a red star to 10 books
that they think are good books.  This helps the book buyers — the
Barnes & Nobles,, Waldenbooks, Costco etc. determine what to stock up on.

Rule #1 was favored not only with a very nice review but also with a red star.

Here’s the review:

For amateur investors who admire the incredible returns produced by
Benjamin Graham-Warren Buffett-style value investing but can’t figure
out how to replicate these billionaires’ methods at home, Town’s
investment guide is manna from heaven.

A former river-rafting guide, Town learned how to calculate such crucial numbers as Return on
Investment Capital and Equity Growth Rate from “Wolf,” a wealthy rafter
whom Town saved from a rapid in 1980. Under Wolf’s tutelage, Town
learned how to turn $1,000 into $1 million in five years, but the
selection of lucrative stocks took weeks of library research. In this
engaging and accessible book, Town shows readers how to replicate that
sort of exhaustive market research on the Internet-and shorten the
research time to just a few hours per stock. Fans of The Intelligent
Investor will recognize that Town’s Rule #1 formula-“1) Find a
wonderful business, 2) Know what it’s worth as a business, 3) Buy it at
50 percent off, 4) Repeat until very rich”-is a variation of Benjamin
Graham’s investment philosophy. (Graham and Buffett are cited heavily
throughout the book.) But Town’s ability to break down that philosophy
into a detailed, step-by-step program that can be understood by any
reader with basic math skills is unique. His chummy, reassuring tone
(“If you’re finding yourself already a bit overwhelmed, take a deep
breath”) will leave readers feeling empowered and ready to manage their
money themselves.

(In bookstores Mar. 21, 2006)

Copyright © 1997-2005 Reed Business Information, a division of Reed Elsevier Inc. All rights reserved.

I have to confess that I am amazed and gratified that at least one
book critic and a few pro investors like Jim Cramer think there is
something of value in the book.  If you decide to get a copy, I’d
recommend pre-ordering it online right now (and yes, this is me
plugging my book shamelessly).  They tell me that you’ll get it at your
house the day it hits the bookstores and you save like 40%.


The book is about what this blog is about, but in the book I go
step by step with screen shots from Yahoo Finance and MSN Money, which I
hope will help a lot of you who don’t have access to professional tools
like Investools.  Like I’ve said a few times, investing is like
farming.  It’s nice to have good tools but you can do the job with a
stick if you have to.  Same with online tools.  MSN is free.  It takes
longer but you can definitely do Rule #1 investing.  (Heck, us little
folks didn’t even have computer tools at all until about 8 years ago!)
So no excuses about getting started.


Now go play!

Phil Town