Corporate Earnings Season

Next week is the start of corporate earnings season, alleluia. Remember that this next Thursday is the first annual meeting which will be held in Lenoir. If you are planning to attend, and have not told me as of yet, please let me know. The first section is from Vanguard. The last section is titled Cliff Young, you will enjoy reading how 1 person changed a sport.

Vanguard

The latest economic reports suggest that the U.S. economy is on a knife's edge—growing enough at the moment to stave off recession, but not enough to make a dent in the unemployment rolls, while casting a shadow on the longer-term outlook. The week's closely watched jobs figures illustrated the dilemma: The unemployment rate was unchanged in September at 9.1%, payroll job growth was substantially higher than expected, and previous months' payroll figures were restated upward. Good, but not good enough, say economists. Meanwhile, Ben Bernanke, chairman of the Federal Reserve Board, warned that the U.S. economic recovery was "close to faltering" and urged fiscal action from Congress and the White House. For the week ended October 7, the S&P 500 Index rose 2.1% to 1,155 (for a year-to-date total return—including price change plus dividends—of about -6.7%). The yield of the 10-year U.S. Treasury note increased 18 basis points to 2.10% (for a year-to-date decrease of 120 basis points).

Corporate Earnings Season

The 2nd week of the first month in a quarter starts corporate earnings season. This season goes strong for about 7 weeks until the end of the second month in a quarter. Typically, corporations announce any earning surprises before earnings season begins. So far, it appears that corporate earnings should be good which should provide support for stock prices. I am really looking forward to the next 7 weeks.

Cliff Young

Many runners already know the legendary story of Cliff Young. Every year Australia hosts the Westfield run. A 543.7-mile – (875 kilometers) – endurance run from Sydney to Melbourne. It is considered among the world’s most grueling ultra-marathons. The race takes five days to complete and is normally only attempted by world-class athletes who train specifically for the event. These athletes are typically less than 30 years old and are sponsored by large companies such as Nike.

In 1983, a man named Cliff Young from Beech Forest, Victoria showed up at the start of this race. Cliff was 61 years old and wore overalls and work boots. To everyone’s shock, Cliff wasn’t a spectator. He picked up his race number and joined the other runners. The press and other athletes became curious and questioned Cliff. They told him, “You’re crazy, there’s no way you can finish this race.” To which he relied, “Yes, I can. You see, I grew up on a ranch. We couldn’t afford horses or tractors, and whenever the storms would roll in, I’d have to go out and round up the sheep. We had 2,000 sheep on 2,000 acres. Sometimes I would have to run those sheep for three or four days. It took a long time, but I would always catch them. This race is kind of like herding sheep!”

When the race started, the pro runners quickly left Cliff behind. The crowd and television audience were enter-tained because Cliff didn’t even run properly, he appeared to shuffle. Many even feared for the old rancher’s safety. The professional athletes knew that it took 5 days to finish the race. In order to compete, one had to run about 18 hours a day and sleep the remaining 6 hours. They also had an entourage traveling with them – trainers, nutritionists, massage therapists, medical personnel, sleeping tents, etc. The thing is, Cliff Young didn’t know this. He had his girl friend and an old pickup truck. (Cliff married his girl friend shortly after the Westfield race.)

The morning of the second day, everyone was in for another surprise. Not only was Cliff still in the race, he had continued shuffling all night – he didn’t stop to sleep. He was only a little ways behind the leaders of the race. Cliff was asked about his tactics for the rest of the race. To everyone’s disbelief, he claimed he would continue to run straight through to the finish without sleeping.

Cliff kept shuffling. Each night he came a little closer to the leading runners. By the final night, he had passed all of the younger, world-class athletes. He was the first competitor to cross the finish line beating his nearest competitor by nine hours. In addition, he set a new course record. When Cliff was awarded the winning prize of $10,000, he said he didn’t know there was a prize and insisted that the money be given to the other runners.

The following year, Cliff entered the same race and took 7th place. During the race, he had fallen and displaced his left hip. His wife kicked it back in place and Cliff continued to shuffle to the finish line.

Cliff came to prominence again in 1997 at age 76, when he set out to raise money for homeless children by shuf-fling around Australia’s border. He completed 6,520 kilometers – (4,051 miles) - before he had to drop out. His only support staff member, his wife, had become ill. Cliff Young passed away in 2003 at the age of 81.

Today the “Young shuffle” has been adopted by ultra-marathon runners because is it considered more energy-efficient. Further more, during the Sydney to Melbourne race, modern competitors do not sleep. Winning the race now requires runners to go all night as well as all day, just like Cliff Young.

• Moral of the story – it only takes one person to change long held perceptions in this world.