It’s a new year, and we will have a new President, a new Senate and a new House.
There are several new Governors across the country and there is hope and opportunities for us to actually Make America Great Again.
I’m praying that’s more than a campaign slogan … and the reality of policies that will restore our economy.
An economy that means:
- Everyone has a good-paying job.
- The scourge of high prices for gas and groceries will get back to being affordable.
- Homeownership can again become doable for younger Americans.
- We see the cessation of military conflicts around the globe and a restoration of peace.
I believe that the people’s voice and vote in the recent election were a mandate to get back to sanity and common sense.
It was a mandate to have a government that didn’t use its power to attack, arrest and criminalize people for having a different political view.
It was a mandate to restore real justice so that violent criminals aren’t put back on the streets while the victims are being kept in the hospital.
2025 will be a year with a LOT of changes.
But one thing won’t change — that God loves us, has a plan for us and will keep us in his Hand as we depend on Him!
Another thing that won’t change? Getting the Real Talk from Charles Mizrahi. Below, he’s sharing a huge edge you can have in your 2025 investments.
Director, Prosperity Research
3 Reasons Investments Fail — And How to Make Sure Yours Don’t in 2025
Though I only met Charlie Munger briefly, his influence on my thinking has been profound.
Charlie was Warren Buffett’s longtime partner at Berkshire Hathaway.
He passed away on November 28, 2023, just 33 days shy of his 100th birthday.
Buffett once said Charlie had “the best 30-second mind in the world. He goes from A to Z in one go. He sees the essence of everything even before you finish the sentence.”
When asked how Berkshire achieved remarkable returns for over 50 years, Charlie’s answer was simple yet powerful: “Avoiding stupidity is easier than seeking brilliance.”
Source: The New York Times
Charlie Munger and Warren Buffett in the 1970s.
This advice became the foundation of my Alpha-4 Approach. Instead of focusing on what makes stocks succeed, I focused on why businesses fail…
1. Weak Financials
The top reason businesses fail is poor financial health.
I’ve never seen a company with plenty of cash, strong free cash flow, and no debt go bankrupt.
Conversely, companies burdened by debt and lacking cash often struggle. That’s why I avoid businesses with weak financials.
2. Declining Industries
The second reason is that the industry is declining.
Even the best-managed companies can’t fight long-term trends.
For example, Jeff Bezos, one of the most outstanding entrepreneurs of our time, has struggled to turn a profit at The Washington Post.
The newspaper industry faces constant headwinds like falling ad revenues and digital competition.
Some industries simply aren’t built for long-term success.
3. Poor Management
The third reason is lousy leadership.
A series of poor decisions can ruin even the most substantial businesses.
Look at Blockbuster, which passed on buying Netflix, or Yahoo, which turned down the chance to acquire Google.
In both cases, leaders misjudged their strengths and underestimated future challenges.
My Strategy
My approach became clear: avoid the obvious pitfalls.
Don’t invest in companies with weak financials, declining industries, or run by poor leaders.
By eliminating these risky options, I focused on companies designed for long-term growth.
It’s a straightforward approach, but it works.
Charlie’s wisdom continues to guide me — and it can guide you, too.
From Lottery Tickets to Long-Term Wealth
Most investors overlook the quality of the business itself, focusing instead on the stock price.
When prices rise, they jump in excitedly, often without any real understanding of what they’re buying — because a stock price alone reveals nothing about the underlying business.
They treat stocks like lottery tickets, chasing quick gains and dreaming of overnight wealth.
Unfortunately, that approach usually leads to losses rather than riches.
Our American Prosperity Report portfolio, on the other hand, is built on outstanding businesses that steadily grow and strengthen over time.
We use my Alpha-4 Approach:
With it, it’s pretty hard not to make money.
Because real wealth in the stock market isn’t about getting rich quickly … it’s about finding exceptional companies that compound returns steadily, year after year.
Regards,
Charles Mizrahi
Founder, Alpha Investor
