investments and spotting trends can bring
more profit than any other investing activity. Combine a
keen eye for what's going to happen with synchronicity and
you have an explosive combination. Here is a story of the
powerful blend that is taking place right now.
All Stars. I grew up in them. We kids loved the way they squeaked on hardwood
floors. Dad hated the
Connies (or did we call them Trannys?), because slovenly
teenager that I was they were often scattered on the
living room floor or lurking in the hallway as a hidden
obstacle course to the bathroom. Dad would try to kick
them away but they gripped like glue and as he stumbled
down the hall he would grumble. Something like "move the
darn tennis shoes".
They were more
than tennis shoes. They were the Boomer shoes at school, at work and at
play. We knew how to tie
them in a special way so the laces did not cross (you know
what I mean if you know). Larry Bird and Magic Johnson
Then the Converse
popularity died. Who knows why? I certainly did not care. I had left America,
lived in Hong
Kong, England and Europe. On that global journey I didn?t
consider wearing shoes called "All Americans".
after returning to the US, I would occasionally see a batch of them, flung
in corners at some
dusty country department or sporting goods store. An
ancient nostalgia would swell. Yet there was never a pair
that fit. Converse only seemed to be making size 13s and
5s at that time.
Then last week
in trendy Naples, Florida I walked into a major shoe store chain. The very
front display was
Converse All Stars. There were all types and pairs in
every size for man, woman and child.
on? Nostalgia quickly whipped me into the me's section where a buying frenzy
took hold. I promptly
bought two pair from the many forms and colors there. They
were exactly my size, one low cut (in denim distressed
which meant a batch of strings were hanging loose that I
promptly cut off) and a pair of fleece lined tan high
tops. We never had so many choices!
Boy this felt
good. I was 16 again and when the shoe clerk said "these have no ankle or arch support",
I quickly replied, "yes but they have the support of nostalgia".
I quickly ran to the car and while Merri was pulling out of
the center, put on the high tops and bounced and squeaked
back to Barnes and Noble for a latte and to read the
Sunday New York Times (which now costs $5-a real statement
about inflation). Enter "synchronicity" As we thumbed our
way through the NY Times, a newspaper that is a real
leader of American thought. Merri pointed out an ad
stating that the New York Times Thursday Style was
featuring an article entitled "Get in touch with your
outer self" and this ad pictured the Converse All Start,
the shoe I had just purchased! This flashed backed to my
messages of some years ago about the book, "The Tipping
Point" by Malcolm Gladwell. This book tells the story of
Hush Puppies shoes. Once hugely popular, by the end of
1994, the makers of Hush Puppies were only selling roughly
30,000 pairs a year, and the shoes were viewed as passé.
They were mainly stocked only in shoe stores in small,
Then Hush Puppies
started being considered hip. Top fashion designers wanted to use them
in their collections.
Word of mouth spread. In 1995, 430,000 pairs of Hush
Puppies were sold, and the next year four times that
At the peak
of this revival of Hush Puppies craziness, Hush Puppies won the prize for
best accessory at the
Council of Fashion Designers' awards.
be making a come back, If so, how do I follow the money?
A bit of research reveled what is going on.
a century old company, and makes the classic Chuck Taylor All Star basketball
shoe and had, as
mentioned, been struggling for years.
Nike and Reebok
had taken over much of Converse's market along with Puma and Adidas.
had become an American icon with 750 million pairs sold in 144 countries.
But the firm lost
touch with the market place, business fell and Converse
filed for bankruptcy in 2001. Later that year, private
investors bought the company, but it was too late.
Nike and some
of the other shoe giants had too much momentum. Nike reported revenue of
$10.7 billion compared
with Converse's full-year 2002 sales of $205 million.
There was no way for the struggling firm to get back in
the game. In 2003 they were sold to Nike for $305 million.
Does this make Nike a good investment? I do not know. I am
looking at this company now and will report more tomorrow.
The point of this message is that our investing can profit
if we keep our eyes on what we are doing. Always stay in
tune with how you feel and how you think. Mix this with
synchronicity and you'll be surprised at where this can
lead,and just think of the fun you'll have getting there!
More on Nike next message. until then, good investing!
P.S. Join us in sunny Ecuador this winter.
Thomas Fischer, me and our Converse tennis shoes for International Business
and Investing Made EZ (plus an expedition to the Andes) and learn
more about the MultiCurrency Sandwich.
to the High Andes, for a real estate tour.
Tour the country
with us on our Import-Export Expedition. (Don't come if you
are looking for a "class
Learn more about
You can see the entire Baron's story on the Converse Nike