A Positive, but Pausing, Theme Has Been Formed – Company Blast Update

In our last post I mentioned that in addition to learning about new companies and meeting various managers, I would keep a watchful eye for a theme that might shed light on the US Economy.  After a looooong first day, reviewing my multiple pages of company notes, comments, key phrases, and forecasts, I feel comfortable with the delivery of a theme that emerged, even with another day to go.  

Company managers have the thirst, confidence, and ability to grow, but they are starved for capital. Said another way “Getting access to capital is still not easy!” While many of the companies I visited with were small, even the multi-billion dollar company managers mentioned capital is still not moving freely.   

Here is our opinion on this matter:

  • It is frustrating that capital is not moving freely YET.
  • Proving the horse to water, but not drink fable, no matter what pressures government officials put on the banking system, they will begin moving when they are ready.
  • When capital does begin moving, (imagine the first dance finally happens at the prom), a cascade of confidence and movement may begin.
  • Tossing our banker hat on, new rules (Dodd Frank) and recent bad experiences are natural inhibitors to money flow, we can’t blame them for being cautious. 

Lastly, as mentioned yesterday, former Fed Reserve Board Member, Robert McTeer was the lunch guest, and spoke for an extended period of time (actually well over his alloted time.)  After scribbling multiple pages of notes, I will leave you with one teaser comment, “Like a Coiled Spring” and save the remainder of my comments for our Zig of positives tomorrow.

Bottom line, a positive feeling from most managers which bodes well for us as investors! Now, back to work, I will duck back into meetings for the duration of the day!

Have a Great One!

JK

214-706-4300

PS  A special Happy Seventh Birthday to my daughter Sophia, today!

 

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