Phil Town & Rule#1 Investing:
Talking Investors Into Destroying Their
Own American Dreams
by: Brendan Magee
There is no shortage of con men, gurus, and prognosticators lining up to profit off the demise of hard working people's American Dreams and Phil Town, founder of Rule#1 Investing falls right into that group.
Some how some way I have found myself on the receiving end of his Facebook posts and when I looked into what he was offering, I couldn't believe it. I mean you really have to have a lot of nerve to legitimately offer to people such complete nonsense knowing full well there is no way in hell you can deliver on your claims.
His first claim is that investors "Can achieve average annual returns upwards of 15% buying wonderful companies on sale." Now when you go to his virtual seminar you will learn a system and a strategy for finding great companies which will only cost you $297.
According to Town, a wonderful company is. "One that will continue to grow as the years go by, surviving whatever challenges the market may throw at them along the way."
So right there is a bait and switch. People who follow his method of investing won't be investing, they'll actually be engaged in predicting the future. No matter what the market throws at these "wonderful companies," they are going to grow, and if the past two years has taught us anything the future is relatively easy to know in advance. Really, at the end of 2019 who didn't know a global pandemic was coming and that the world's economy was going on lockdown?
Even more evidence that you won't need to protect yourself from the future is Rule#1 Investing's claim that, "You don't need to diversify, if you know how to invest." The reality is you don't need to diversify if you can predict the future. If you know every year what the top performing companies are going to be, there is absolutely no need to diversify. Here again, Rule#1 Investing shows its flaws. If you can identify the top performing company, why would you need to buy more than one? Why wouldn't you simply buy the company that was going to perform the best? Why waste any money on the second best company?
The simple truth is no one can predict the future, no matter how much they would like to believe it. Rule #1 investing is putting people in the same position as people walking into a casino. They are gambling, only they may be doing it with money they will need to retire or put their kids through college. Gambling a few bucks on a football game or on a weekend in Vegas may be enjoyable and harmless, but talking people into doing that with the money they will need to fulfill on their American Dream is disgusting. Unfortunately, the only protection people have from these kinds of scams is to be aware of them and avoid them before they fall victim to their seductive pitches.
If you have any comments or suggestions, call 610-299-3969 or send an email to brendan@coachgee.com.
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