Poor Richard. Introduction.

It was a windy and cold winter of 1992. George Bush (father) threw up all over Japanese Prime Minister, Boris Yeltsin decided to stop targeting US cities with nuclear bombs and one young Russian immigrant got his first job in America. Guy knew nothing about stock market, and everybody around him were in a same haze of ignorant bliss, infused with taste of Corona and sweet aroma of fine Mexican bud. Nobody told that young lad about importance of saving, retirement, inflation or a growing tech boom, about to sweep this young continent from West coast to his nearest suburbs. It would be nice to send him a letter from 25 years into the future: "Goblin, put $100 into certain mutual fund according to this specific plan, based on these few rules. Do it once a month, spending only 30 minutes, and after a while you will have a life-changing sum of money. Use this 'Poor Richard' method diligently and do not waver from the original plan - for your rewards will be plenty and satisfaction immense."

I am sending this letter from the future to a new generation of green whippersnappers: Goblin, do it now!

Let’s face it, a young single foreigner or a kid out of school, or a college graduate with student loans and uncertain prospects, all are highly unlikely to be savers and investors. First of all, it is nearly impossible to save any money at-all if you don’t have a steady income. Budgeting is very hard without a regular job, because you never know when your next pay-check is coming, so whatever cash is saved should be kept for a rainy day. Secondly, even if you have a job, there are never-ending expenses, bills, ‘keeping up with a Jones’s’, vacations that always cost more than anticipated, kids, gifts… there is never any money left over… 

As Poor Richard said (in 1749): “The Art of getting Riches consists very much in THRIFT. All Men are not equally qualified for getting Money, but it is in the Power of every one alike to practice this Virtue.” The trick is to save so little, that is makes no difference on your monthly budget. The kind of a sum that can be chipped away little by little from everyday expenses by frugal and sensible money management. 
“Save and Have – every nickel makes a Mickle”, instructs Poor Richard.

One Hundred Dollars per month. A cup of Starbucks coffee per day. A movie for four, or a dinner out for two. Bottle of whiskey and an 1/8th. Only $100 per month… will become a very serious pile of money, if you wait, save, invest and practice basic money management skills. In this series of ‘Poor Richard’ articles I will explain exactly how to do it, with step-by-step instructions and my own observations, but I want to caution my dear readers that (in words of Jesse Livermore) “the fruits of your success will be in direct ratio to the honesty and sincerity of your own efforts in keeping your own records, doing your own thinking, and reaching your own conclusions."

In order to make money in The Market I need to answer these 4 questions:
WHAT to buy, WHEN to do it, HOW to bet, WHY to sell.

I will address all these topics in due course, and will lay out my logic as best as I can, so a patient reader can absorb this method, shape it to fit his own personality and circumstances in order to continue using it on their own for many decades into the future. The goal is to use ‘Poor Richard Method’ objectively and independently, without relying on (always) fake news, vague economic theories and unscrupulous market commentators.

Basic tenets of Poor Richard Method are really not a secret and plastered all over the internet as well as numerous books. You can go to Vanguard.com for all the charts and graphs you ever wanted to see, with loads of ‘scientific’ papers used to support their wild claims. Or you can read Malkiel’s “Random walk down Wall Street” for everything you ever wanted to know about financial markets and investments, but where afraid to ask. Everybody talks about ‘long-term’ investing, buy and hold, stay the course, don’t worry… and all their results are ‘hypothetical’ or estimated. 
In reality – something completely different happens… and you lose money.

This ‘Poor Richard’ series of articles are designed as a process of self-discovery, guided by solid principles and strict rules. 
It offers a sensible roadmap for a responsible investor, the one that understands meaning and value of Wealth.

"The design is to let the reader form his own opinion in a sensible way". - W.P.Hamilton

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.this is a first article in 'Poor Richard' series.

Read Part 2: Poor Richard. The Tools.

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