FACTORING IN THE BIRD FLU: THE EFFECT OF GLOBAL EVENTS ON YOUR INVESTING DECISIONS

Here's a quick Q&A from Sandra.

Hi Phil,

Please bear with me, I'm still trying to catch on.

Let's say Sanderson Farms met Rule # 1.  Do you factor in global events, like the bird flu? How does this effect your decision?

Thanks,Sandra

Good question, and one we haven't addressed yet. Here goes:

Hi Sandra,

Should we factor in the bird flu?  Well, let's try.  The bad thing about the bird flu is that it might kill all of Sanderson's birds.  The good thing about it is that it might kill all of someone else's birds, in which case the price of Sanderson's birds will skyrocket and our biz will make a fortune that year. 

Or nothing will happen. 

In other words, I ain't smart enough to figure this out, so no, I don't factor it in.  What I do is keep track of those arrows and understand that if the Big Guys think bird flu is going to mess with their investments, they will start to sell -- in which case I will get red arrows and I'm outta there.  And so are you!

Our job is to look at the long run, make sure we understand the business, and invest when we find a wonderful long term, predictable (all of that is included in the word"wonderful" but I thought I'd throw it in for good measure) business when it is available at an attractive price.  Bird flu will come and go, and we'll get in and get out.  But we're on this for the long run.

Now go play with your chickens.

Phil