The Investment U e-Letter: Issue #691
Monday, July 9, 2007 Freedom Fest: The Investment Conference That Wasn't Just About Investing
by Alexander Green, Chairman, Investment U; Investment Director, The Oxford Club I've just returned from Las Vegas. (It's the only thing to do if you find yourself there in mid-summer.) With the weather outside a balmy 116 degrees, I didn't spend a lot of time on the tennis courts. I was there to speak at one of the country's most unusual investment conferences, FreedomFest, organized by fellow Investment U contributor Mark Skousen. There were a number of thought-provoking investment analysts and newsletter editors at the podium. But what gives this conference a unique twist is that many of the speakers go beyond investing to include art, science, religion, politics, and philosophy. There were dozens of highlights. Here were a few of my favorites… Highlights from Freedom Fest John Mackey, CEO of Whole Foods, spoke on the lost art of self-actualization. Mackey is best known, of course, for turning his single small grocery into the nation's largest chain of organic food stores and his company into a member of the Fortune 500. (Mackey is not your typical CEO. He takes off several weeks a year to go long-distance hiking and devotes a great deal of time to environmental protection, animal welfare, and other charitable causes, including his new organization FLOW.) To be a self-actualizing individual, Mackey suggests you see life as a series of choices "and choose the growth choice each time." Since space doesn't allow me to share all his suggestions here, you might learn more by visiting his new website, www.FLOWIdealism.com. Another entertaining speaker was economist Art Laffer, former advisor to President Reagan and originator of the famous Laffer Curve. Laffer's topic was "Why I've Left California for Good." Laffer loves California, but he says the state's fiscal problems are mounting and virtually unsolvable. He made a powerful argument that California housing prices will hit the skids over the next few years. In fact, he suggested that many California homeowners - particularly the ones who bought at the top and are already under water - would be better off taking a small loss now rather than taking a larger loss later. (When asked what a Californian is supposed to do after selling his house, he said "rent.") Over dinner that evening, I learned that Laffer is actually more optimistic than I am about the future direction of home prices in much of the rest of the country. (More about this disagreement in a future column.) Not all of Freedom Fest was a smash, of course. Author Nassim Nicholas Taleb's 50-minute presentation on the unpredictability of markets could have been 40 minutes shorter. And the debate on organized religion generated more heat than light. But this was mostly because panelist Doug Casey has an unfortunate tendency to substitute snide remarks for facts when making an argument. The "Founding Fathers" of Freedom Fest However, the few shortcomings were easily forgotten by the final night's banquet. That's when we were treated to an after-dinner talk by three of our nation's Founding Fathers, each of whom arrived in period costume and speaking a fiery brand of colonial English. Patrick Henry thundered against George III and demanded that we give him liberty or give him death. Thomas Jefferson reminded us of the virtues of limited government… and that the price of freedom is eternal vigilance. And Dr. Benjamin Franklin - who was so good it was scary - said that he enjoyed kissing the ladies and confessed that his father thought him "much too saucy to enter the clerisy." But the real surprises came from Thomas Jefferson during the question and answer period. Asked whether he smoked Virginia's primary cash crop, tobacco, Jefferson replied "I tried it once, but I didn't inhale." Asked "is this republic likely to endure?" Jefferson seemed unsure. "It depends on what the meaning of the word 'is' is." And when a member of the audience inquired about his long-rumored affair with slave Sally Hemmings, Jefferson took great offense. Indignant, he insisted that no gentleman would ever ask such a question. But when the audience hooted derisively, demanding an answer, Jefferson turned and sternly intoned, "I did not have sexual relations with that woman, Miss Hemmings." I guess history really does repeat itself. Good Investing, Alex Today's Investment U Crib Sheet The Takeover Party Continues… This morning, the private equity firm Carlyle Group announced it was taking a manufacturing company private in a $2.7 billion deal. The firm will pay $175 a share to buy out Sequa (NYSE: SQA-A). That's a 54% premium to Friday's closing price. Relatively low interest rates, easy credit and large cash reserves are fueling record-setting deal volume this year. Through the first six months of 2007, worldwide mergers and acquisitions activity totaled more than $2.7 trillion. For more on the takeover boom, including four ways to profit from massive private equity funds, read our latest opportunity report. Related Articles Investment U Archives 
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