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Foundation Investment Advisors and Consultants
 

Insights and Publications

Colonial Consulting provides insights and analysis on current conditions and challenges, market environment, and industry trends.

Quarterly Commentaries

  • Predicting the impact of macro factors is one of investing鈥檚 greatest temptations. Turn on the news and topics like commodity prices, interest rates, and currencies are being discussed constantly, with pundit after pundit confidently offering commentary on how these factors are going to impact equity markets. And in the short term, sometimes they get it right. When Hurricane Harvey hit Texas and it became clear that major production and refinery operations were going to be disrupted, many observers correctly remarked that oil prices would rise in the midst of the supply tightening, and companies that benefit from rising oil prices would reap the reward in the form of higher equity prices. While these types of equities would've been short-term winners, it鈥檚 important to note that this is a trade, not an investment, and trading strategies rarely compound capital over long periods of time.

  • We know great innovation when we see it. It creates the sensation of the never-before conceivable, a new idea that seems inevitable once it鈥檚 revealed but was almost unimaginable prior to its creation. Innovation, a word first used in the 15th century, refers to the act or process of introducing new ideas, devices, or methods, but we know it as an intention to not just improve the prior generation of products or services,but revolutionize its usage. For an example of true innovation, look no further than the palm of your hand. The smartphone is a truly world-changing device, one that has seen penetration happen so quickly and so disruptively as to fundamentally change the utility of a variety of single-use products formerly purchased separately. The smartphone is not just a phone, it鈥檚 also a camera, and a television, and a video recorder, and a game player, and a map, and a whole host of other ancillary things depending on the user鈥檚 needs.

  • It was 2013 and Marc Lore, co-founder of Diapers.com parent Quidsi, was anxious for a new venture. He had recently left Amazon, which had purchased his company for $545 million in 2010 after an escalating price war that Lore ultimately concluded he couldn鈥檛 win. He was in New York, having lunch with an investor from the well-known venture firm Accel Partners, when he pitched his new idea 鈥 an online shopping club where the company would utilize membership fees as its primary source of revenue. A pricing algorithm would squeeze costs from every possible source 鈥 shipping, transaction fees, order size 鈥 and pass along these savings to the consumer. Lore鈥檚 theory was that online companies like Amazon and Walmart.com were catering to the wealthier-than-average middle-class shopper, and that nobody was catering to the just average middle-class shopper, the one that could wait a few extra days for a product in order to save a few extra bucks...

  • Few terms grab the collective attention of citizens in a democracy more than 鈥淢arxism.鈥 Defined loosely as a classless society, it reflects the social, political, and economic theories of its chief architect, Karl Marx, a German philosopher who collaborated with Friedrich Engels to author 鈥淭he Communist Manifesto鈥 in 1848. Marxism is often used interchangeably with the word 鈥渟ocialism,鈥 an economic and political theory advocating collective ownership and administration of the means of production and distribution of goods. In other words, the opposite of capitalism. Despite some bad actors throughout history, capitalism has persisted because it rewards creativity and hard work, key components for the growth, wealth, and productivity of a functioning and thriving society. This is a system that equity investors know well and in which they have the greatest confidence. As far as most equity investors are concerned, socialism is a scourge that impedes progress, not advances it...