AP Photo/Ric Francis
Investors—some for the first time—have watched the value of their portfolios plummet. It’s a harsh reminder that the stock market is always a gamble, both because of its whimsical nature and its nontransparency. Few people were aware of what was going on backstage on Wall Street. Instead, the mantra (or sales pitch) was—and continues to be—invest in the stock market or be left in the financial dust of those who do. But for many investors the stakes were too high.
Writer/actor/director/producer Carl Reiner’s approach to investing is for preservation and inflation, and that kind of surefootedness with an eye to comfort might be what real value investing is all about.
Reiner’s career began during the Great Depression, when jobs were few and far between. Reiner, author of a new book, “Just Desserts,” was the beneficiary of two government New Deal programs that trained and paid unemployed actors to work. He earned $22.50 a month and tells CD that he would have been satisfied with $75 a week for the rest of his life. So, it’s no surprise that he invests conservatively.
“The best [money] advice I got was from my agent,” Reiner says. While Reiner was starring in “Your Show of Shows” in the 1950s, that agent directed him to an accounting firm that invested his savings primarily in nonresidential land development but only after conducting research on the properties for 1 to 2 years. Reiner still uses that firm today. He adds that the firm never invested show-biz clients in stocks, because it believes that stocks are too speculative. Its investment goal wasn’t to make a killing.
Reiner says his returns are modest compared with historical average stock market returns of about 8 percent but that they’re reliable. He also owns Treasury bonds and municipal bonds.