FDR and political riskFDR is an ideal kind of stock in some respects. For example, it can remain unknown to 99.9% of investors yet still deliver excellent returns for its shareholders. An advantage at a time like now. This much we all know.
Stockhouse rightly frowns on (and removes) political postings. And I don’t need to comment directly on yesterday’s events in Pennsylvania anyhow. If you are reading posts discussing stocks like FDR you are easily smart enough to interpret such news for yourself. But predicting how it might affect the short-term price of our Founders shares is not as easy.
History records how sharp shocks to market sentiment, whether the September 11th attacks, the 2008 crisis, or Covid’s arrival in March 2020, generally resolve themselves well. And often quite quickly. Even manias. The peak of the Dot Com frenzy only knocked Berkshire Hathaway’s share price down very briefly… until people remembered the physical world still had investment value.
Now, this is not to say Monday’s opening price for FDR will provide a great “buying opportunity”. Even if it *were* to open 30% lower, it is possible American political violence continues to escalate, hurting all speculative stocks for months until some kind of relative peace and/or stability again returns.
Nor is to say our company’s market value declines at all tomorrow morning. It may even rally. Especially if gold prices continue to move higher. Which, after Saturday’s assassination attempt, is arguably what gold prices will do.
But I hope my fellow FDR shareholders keep things in perspective. You can be sure I care deeply for how American politics trend – and in which direction. Yet even in most of the worst-case scenarios, it changes little what our company is worth when the buyout offers come in.
The timing of which ought to be, as Chris Taylor used to say of Great Bear, a matter of “months, not years.” His words being proven directionally accurate, if a bit boastful.
In the meantime, we could see the impact of some nervous sellers. People with cash never need to buy quickly whereas people lacking liquidity often need to sell fast. But a different set of rules apply to FDR holders waiting for a buyout.
Because we know the gold mining majors face a perpetual shortage of good properties to acquire, and thus can’t really afford to be patient.
Which is good, because it helps all of us shareholders to *stay* patient. A wise stance in most of life’s situations. Stay strong, everyone.