Yesterday, our pastor taught about the parable of the talents. And he used an interesting tactic to help illustrate the principle. He asked twenty people, ten from the first service and ten from the second service, to apply the parable in a practical way. He gave each person one hundred dollars and he asked each person to take that money and to make it grow over the next two weeks. After the two weeks, each person would give a report on what happened to the one hundred dollars.
One person is going to use the money to buy the ingredients necessary to make pies and then to sell the pies to grow the original one hundred dollars. Another person is going to buy snow shovels and then clear driveways as a way to grow the original one hundred dollars. Good ideas. People love pies and, with yesterday’s return to winter, lots of driveways will need to be cleared.
Last night I took the family went out to dinner to celebrate my youngest son’s birthday. He turns 9 on Tuesday. During dinner, we talked about the one hundred dollar challenge and how we might approach the problem. Being a value investor, and not a day trader, I would not have enough time to invest the money and let it compound. Rule of 72 at a 10% annual rate of return would need over 7 years to double the investment. Clearly not an alternative.
So what to do? We wrestled with several different ideas. Everything from playing music in the subway to holding an auction for a round of golf at my home course. I then thought about all of those Apprentice episodes. Where they send out teams and have them sell stuff and the team that makes the most money wins. And someone from the other team gets fired. Maybe that is what we should do. Buy some cheap stuff and then add a markup and sell it.
Candidly, I was glad that we did not have to work on this challenge directly. It is definitely much harder than it seems.