VIDEO: You've Got the Brains, I've Got the Books, Let's Make Lots of Money

In today’s Daily Rundown video, Chris Versace explains why the market is treading water this week and why next week’s April economic data will change that. 

He also lifts a question from the Forum and shares a few of the books (from his own bookshelf) he recommends on investing. 

Transcript

CHRIS VERSACE: Hey, folks. Chris Versace, Thursday, May 9, almost the end of the week. Markets are up today, but they really haven't changed all that dramatically this week. And candidly, they're not likely going to either as we close out the week tomorrow.

Yeah, we're continuing to get the trickle of earnings, but, you know, as we talked about, there hasn't been a real major economic data point. We continue to see the parade of Fed heads largely reiterating the same thing. But I think by and large, the market is kind of, as Helene Meisler would say, chopping around here, waiting to see what's next. And of course, that is going to be something that we determine based on the next round of big economic data.

And believe me, it's important. And all of it's going to be happening next week, what is this data? Well, it's going to be the April CPI, PPI, retail sales, and to a lesser extent, housing starts. And as we know, the market is trying to figure out rate cuts when. When might they start? Is the current market thinking of September too soon? Is it likely to get pushed out?

You know my thoughts. I think that's likely to happen. And there are other reasons why I just don't think that a September rate cut is going to be on the table. But the data we get next week will start to allow the market to revisit those expectations, maybe solidify what it's thinking.

I'll just say this real quick, remember the relationship between the PMI reports and the CPI data? We talked through, I think, yesterday, in our video, about what the expectations are, talking about the Cleveland Fed nowcasting model and some other things. So not a lot of improvement is expected one way or the other. And if we don't get much improvement or the data moves the other way, meaning higher, it is going to push the expectation down.

But again, between now and the next couple of days, we're going to continue to chop, tread water, call it what you will. But it's waiting for that data. And when it comes, the market's going to start figuring out what its next move is. So what I wanted to do is really talk about and answer a question that was posed in the forum. Somebody asked about good books to read to become a better investor.

And look, there's tons of books out there. But what I want to talk about, some of the ones that I just, if you can see behind me, I literally pulled off my bookshelf. But first, let me say this. The forum today was exceptional-- tons of questions, a lot of interaction. And I really appreciate that.

I think that the forum is just going to continue to get better as more people come in, ask their questions, share their thoughts. It's just simply wonderful. And again, I really appreciate everybody coming in. So let's talk about some of these books. But let me just say this as I think about it, one, you know, look, there's a lot of books out there. And I would like to say there's a silver bullet-- just read this one and that'll be it.

But the reality is that simply isn't the case. You know, some of these books I've had for a long time, some I've reread, you know, and there are others that I'm not actually pulling down from my shelf either. So the message is we need to be a sponge. We need to amalgamate various things so we can become a better investor.

But I will also say two other things. One, it's one thing to read about it. It's another thing to go through it. Experience is always, always a far greater teacher in my book. And that really brings me to my second thing. Of all the books that I'm going to mention, probably the most important one is one you can't buy in a bookstore, you can't buy it on Amazon.

It's the investment notebook where I keep my notes and I keep my what went well, what did we miss so I can continue to improve and learn from my mistakes. I can sit back and trace through, see what I was thinking, you know? And it just really helps to bring some clarity. And like I said, it allows me to see where my thinking might have been off a little bit, other data that I should have been checking. And it's just it's a great resource to have and I can't tell you how many of these notebooks I have since I first entered equity research back in 1993 at 7 World Trade Center.

So with that, though, let's just get to some books that you can pick up and we'll go from there. So the first one is, of course, "The Intelligent Investor" from Benjamin Graham. It's a hallmark book. It can be a little snoozy at times, a little dense. But as you can see, my highlights and stuff. There's a lot of good stuff in here. And I would suggest that if you're just starting out, this would be a good book to read.

The other one, if you're just starting out-- and this is the one that I say to my students when I was teaching, is follow what you know. And this is a great book from legendary investor Peter Lynch, "One Up On Wall Street." You know, there's great anecdotes in here, great insights. And it's just a very, very enjoyable read. And I would suggest that if you haven't picked this up, you should.

When it comes to growth stocks, this was a book that I picked up some time ago, "Finding The Next Starbucks." Obviously, this was before the recent issues that Starbucks is undergoing. But how to identify and invest in the hot stocks of tomorrow? You can see that I've kind of poured over this several times.

You know, talking with other folks is great. You know, when it comes to the podcast, that's one of the things that I'd like to share with you all. It's the conversations I have with whether it's Helene, Bob, Sarge, or the management teams or others, because you're always picking up insights and nuggets that can help sharpen you.

That kind of speaks to this book, "The Super Analysts," which was a great book. It was, as it says, conversations with the world's leading stock market investors and analysts. Just, you know, simply, simply a great book. Little thick, little sleepy at times, but if you're willing to read it, I would suggest that you pick it up. It's a good one.

And then this one isn't necessarily on investing, but it's "The Discipline Of Market Leaders." And I just found this was really refreshing and a great way to think about how companies are developing or evolving their business models going forward. And I try to apply some of that thinking when I look at the companies that we either have in the portfolio or are looking at potentially for the bullpen.

Now, the big one and you know, this is going to be pretty boring, I'm going to admit, but this is the textbook that I used when I taught in graduate investment classes. It's Investments by Bodie, Kane, and Marcus. It is a heavy, heavy book. But there's all sorts of examples and it's really just a compendium of information on how to value investments, think about investments, that sort of thing. So that would be a good one.

The one other book that I don't have, because I give them all away, is a copy of my own book, "Cocktail Investing, distilling everyday noise into investing signals." You can find that on Amazon. If you want to take a look at it, just search my name. It's over there.

But these are some of the books. I will share more over time. And what I would ask is if you watch this video and you've got a book that you think that we should be sharing with the membership, either send me an email at [email protected] and I'll mention it. Or just head over to the forum and post it.

I think people would love to hear that and hear about those and any other insights that you might have whether it's other books, newspaper articles, journal articles, what have you. So I'll leave it there for today. That is today's video, by the way. And please remember, check your Alerts, check your emails.

We want to make sure that you are following along with us, not only getting our latest thoughts, but any moves that we might-- excuse me, any moves that we might make with the portfolio or even the bullpen. Thanks for watching.