Equity makes executives complacent. A cash-crunch is better than any crash diet. Stocks gain while managers writhe in pain. Put the world liquidity crisis to work on your investment portfolio. Buy stocks of corporations that are conservative in leverage, which have Gross Margins many multiples of interest costs, which sell on rigid credit terms, and which excel in just-in-time inventories.
My personal learning curve with liquidity crises has been hard indeed. I had to take lessons in 'Finance for Non-Finance Executives' because I once used liberal credit to generate market and brand shares. I recoil with horror at memories of starting each working day juggling cash flows with my colleagues. However, that set of learning has never left my side. I now view all credit lines with suspicion. I support companies that are mean with cash, even though they are not lean with respect to this resource by any means.
Write to me at drsbanerji@gmail.com or post below if you would like top stock picks based on excellence in cash-flow management.
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