Validation
RECENT THOUGHTS
A friend of ours just yesterday came to us and told us of a recent purchase that he had made that he was excited about. This was a moment for us that validated the reasons why we own certain businesses that we have in our client portfolios.
Our friend, call his name Bob, was up late at night (actually it was 3am in the morning…oh the life of retirement!) watching QVC – the televised home shopping network channel. QVC is owned by Liberty Media Corp. (LINTA), a company we are owners of and like how the doors on this particular store are never closed…in fact, we like that there are no doors and thus no capital needs for “brick & mortar.”
Bob was fixated on the current offer that was being televised. A Dell Mini laptop (DELL – another company we own), with Microsoft windows operating system (MSFT – another holding of ours), and other anti-virus and publishing software pre-loaded onto the machine…the price tag…$450! Bob was hooked and despite his lowered discretionary spending budget, how could he afford not to pick up such a bargain?!
Well, Bob made his purchase and has been very pleased with his new toy. It made us think that despite the longest recession we’ve seen for many years, there are still people out there like our good friend Bob, who feel that purchasing a Dell Mini is as essential as purchasing food and other items to sustain life. While not confirmed, we can just envision Bob sipping a Coke and eating a bag of Frito-Lay potato chips while sitting on the couch (two other companies we own).
Indeed we live in an electronic age, where we wonder what on earth people did when the internet and personal computers were not around. It’s moments like these that vindicate and provide real life examples on top of the bottom up research that we conduct here at YCG.