[oclug] [Humor](Fwd) Nortel vs Beer
dean at protus.com
Fri Sep 7 15:44:58 EDT 2001
Just remember, this was written before Nortel stock fell below $9.
------- Forwarded message follows -------
Subject: FW: Nortel vs Beer
Date sent: Tue, 4 Sep 2001 08:05:22 -0400
On July 26, 2000, two friends, Jim and John, each got a $1000 bonus at work. (They both work
for Nortel Networks, where in the summer of
2000, there was LOTS of money around for bonuses).
Jim, being an intelligent, financially concientious person, put the
whole $1000 into Nortel Networks stock. With his $1000, and the
transaction cost of $35, he was able to purchase 7 shares at $123 each. Having watched the
Nortel stock climb and climb, he
felt very good about this investment, happy that he is preparing for the future.
John, being a more care-free sort, did something slightly different
with his $1000. John borrowed a friend's truck, and proceeded to the Beer Store, where he
purchased 33 cases of beer. John also
felt very good about his investment: 33 cases x 24 = is 792 bottles
of beer! John, also being an intelligent guy, although perhaps not as forward-thinking as Jim,
calculated that he could drink about 15
bottles per week, and he wouldn't have to buy beer for a whole
Jim, of course, was appalled by John's purchase, and berated him
constantly about it. As months went by, Jim excitedly watched the stock prices, and saw it start to
dwindle. "It'll go back up", he'd say to John.
John, who has been reaping the benefits of his investment on a daily
basis, would reply, "Ya, it will. Hang in there buddy".
Months went by, and the value of the stock continued to fall, and there was the beginnings of a
noticeable dent in the beer pile.
Midwinter came, Jim's stock had fallen to about half of it's original value, and John's beer was
about half gone. Jim, being sure that the
stock had hit rock-bottom, still was berating John for his frivolous
purchase, telling him "Your beer will be gone in six months! Who knows what my stock will be
Well, summer has come, and hard times at Nortel continue.
Bad news: Both John and Jim have been affected by the layoffs.
Last week, in order to raise some cash to help through
the rough time, Jim sold his 7 shares, at that day's value of $12, and got $84, then after paying the
$35 transaction fee, he only had $49. Jim stopped by John's house later that day (everyone
needs their friend's during rough times), and as luck would have
it, there were two bottles of John's beer left. John, being a good,
compasionate friend, offered to share his last two bottles of beer with his friend. Jim appreciated
the gesture, and enjoyed the cold beer on the hot summer's day, but he felt a bit guilty. "At least I
got fifty bucks back out of it - you have nothing now.", he said.
"That's ok.", replied John. "Perhaps you can help me, I need to return all these empties.", he
added as his other friend with
the truck pulled in. So, they loaded up the truck, and proceeded off to the beer store.
Upon arrival at the beer store, they unloaded the empties, feeling a
little grim. John went to the counter, and collected his refund for the bottles. "33 cases x 24
bottles, at 10 cents per bottle, that comes to $79.20", the friendly Beer Store clerk said to John as
he handed him the money.
Jim was speechless. Poor guy. Can you imagine how you
would feel if you just discovered that over the course of the last year, your $1000 stock investment
left you with $50, and taking same 1000, buying beer, and drinking it, would leave you with $80.
I'll leave it up to the reader to come up with they're
own "moral to the story".
Have a nice day, and happy investing.
------- End of forwarded message -------
FYI Nortel is currently at $8.51 I'll let you figure out how much Jim stock would have net'ed him
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