On this day in 1998, Richard Russell, in his Dow Theory Letters, said the following:
"...Another very, important consideration is this: Many wealthy and sophisticated investors are ardent practitioners of compounding. In order to compound, you must receive a return on your investment. A 1.5% return or less from stocks, compounding becomes almost impossible. But with 5.5% coming in, compounding works. For this reason, large individual investors, who are well aware of the fortune-building power of compounding, will opt for bonds rather than stocks at this juncture."
"There, I’ve given you a cold, unemotional rundown on the price action for gold. Everything else, all the rumors, all the hopes, all the concepts they’re interesting but we don’t buy and sell concepts, we buy and sell PRICE."
-Richard Russell. Dow Theory Letters. July 1, 1998.
