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Top Ten Movies with a Financial Lesson: 5-7

May 18, 2011 7:26 AM ET
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Long/Short Equity, Growth, Value

Seeking Alpha Analyst Since 2009

Read full article at: stocksonwallstreet.net/featured/top-ten-...

Continuing Monday’s article “Top Ten Movies with Financial Lesson: 8-10” below is the next set of the list, enjoy!

7.  Treasure of the Sierra Madre (1948) –  Classic western cautionary tale about how not to launch a venture.  If you took everything that Howard Dobbs & Kutan did in this movie: “Get rich quickly without a credible business plan.”  “Badges, we don’t need no stinking badges.”  Don’t swing blindly, don’t come up w/ a get rich quick scheme, don’t do a pyramid scheme, don’t sell products from your house to your friends or recruit your friends.

Lesson:  In life, as in baseball, you’re gonna strike out.  You don’t want to strike out blindly while your pursuing a huge home run.  You gotta know your business, know your partners, know where you are in all of this.

6.  Working Girl (1988) – Melanie Griffith plays Tess McGill.  Endearing 80s film.  Ultimately she takes a job as a secretary but she wants to rise in investment world.  Wants to rise to power, combines her business degree from night school w/ her street smart acumen & pulls of a mega-merger.  Total fantasy.  Prince charming happy ending w/ Harrison Ford.  “I have a head for business and a body for sex.”, says Melanie Griffith’s character.  Go back to night school, go back & get a degree.  Go get educated, you’ll get leverage.  No one can take your education away from you.

Lessons:  Your education, your smarts can’t be wiped out in a recession.  Your earning power is rooted in your skills, in your education.  Provides an entertaining reminder that if you have something to offer your co. & they don’t seem too interested, then take your skills elsewhere.  If you are a super powerful earner at one job, you can make yourself a super powerful earner anywhere.

5.  Enron: The Smartest Guys in the Room (2005) – Before Bernie Madoff, there were Ken Lay and Jeff Skilling who ran the Houston energy firm that was going to reinvent how energy was going to be done in America.  Enron was highly profitable, had a great amount of cash flow and earnings and the stock price soared.  Its executives cashed out options worth millions and told employees their best 401K option was Enron stock.  Thousands lost all their retirement savings because they put all their bets on one company.  Took Enron 16 yrs to from 10b assets to 65b assets, but it took them 24 days to go bankrupt.  It won the Academy Award for best documentary.

Lessons:   Have a financial plan, have a discipline.  If you have a stock that looks too good to be true and it just keeps going up, up, up, it’s probably too good to be true.  Diversify, Diversify, Diversify.  Don’t put all your eggs into one basket.

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