Grounded

Celine Fur Shoes

While visiting Paris recently, I was sipping café au lait and munching on lightly toasted Poilâne bread with butter and apricot jam at my favorite breakfast spot on Rue Cherche-Midi when I came across this breaking news: Cannes Red-Carpet Ban on Women Wearing Flat Shoes.

Well, there goes my chance to gate-crash the Croisette. Flat shoes are the tops for me. What started out as “troubled” feet, gradually, with time, jogging, and far too much footwear-inflicted abuse, morphed into end-stage arthritis. A good day means walking the dog—or the winding, cobblestone streets of Paris—without wincing with each step. A bad day, (scratch that, a very bad day), would be being forced to walk in high heels—or, in other words, not walking at all.

It so happened that my career in fashion magazine publishing coincided with a vexing trend in women’s footwear. Designs veered into the realm of S&M with spiked-metal studs and thigh-high, stiletto boots. Nicknamed “limo” or “taxi” shoes, the only way to get around was to hobble into a waiting car. A limited few rose to the occasion, the rest were fashion roadkill. Let’s just say that with my flat, lace-ups, I stood out in a fashion crowd.

But there’s always an upside. My limitation means that I can walk into any shoe store and immediately eliminate 90% of the offerings, so decision-making is faster. In a city like Paris, with great shoe boutiques on practically every corner, this means more time to visit museums and to eat and drink.

On the 8-hour flight home I read The Einstein of Money, a terrific book on Benjamin Graham, the father of value investing. Graham’s rules for disciplined investing have inspired millions, including legends like Warren Buffett and Charles Brandes, and other “superinvestors”.

Graham developed screening methods to assess the intrinsic value of a company based on such metrics as size, earnings growth, dividend records, and ratios of price-to-assets, and price-to-earnings. This allowed him to know whether a company was a bargain or overpriced. Unlike others who base investment decisions on predictions of price movements, Graham peered into the income and balance sheet statements to discern value (not price).

Starting out as a bond salesman, at which he failed miserably, Graham eventually became a financial analyst. In 1916 he strongly recommended to his boss Alfred Newburger that the firm make a substantial investment in a company called Computer-Tabulating-Recording, Corp. that was selling at $45-per-share but whose intrinsic value Graham had estimated at closer to $130. His boss told him, “Ben…I would not touch it with a 10-foot pole.” In 1926 that firm changed its name to IBM.

Graham’s strict investment guidelines meant that he missed many hot stocks and gains through momentum investing. Yet, I admire his ability to eliminate thousands of potential investments into a select few that were highly likely to be “sure bets”, particularly if one was patient enough to let the market eventually weigh a company’s true value.

Today, like a woman shoe shopping in Paris, an active investor has an infinite number of decisions to make. Even product categories like ETFs and mutual funds that should, in theory, simplify investment selection, have exploded in recent years. When I began investing 25 years ago, ETFs didn’t exist and mutual funds were very costly so I began to cobble together a portfolio of individual equities. The process is stimulating and rewarding but can be very time-consuming, and quite harrowing when you add global, and emerging market equities into the mix. Lately I’ve been wondering if there aren’t better uses of my time—like learning French or writing a book?

Though I’m not ready to pull the trigger on my individual holdings, after reading The Einstein of Money, I know what Graham would do. Simplify the selection process.

Oh, and if you have troubled feet and happen to be in Paris and want to simplify your shopping, here are some brands to try: Accessoire Diffusion, Fausto Santini, Gelati, and Prada Sport. Then, with all the time you’ve saved, treat yourself to a glass of Chablis at Café de Flore and watch the pretty people.