Peter Lynch | Charlie Rose | 2013

Transcript

people buy stocks because they've fallen from price x to two thirds of x or half of x on that basis alone they're buying a stock that's called bottom fishing the stock market very very difficult i've had a rough go with it peter lynch is here he is a legendary investor he is a best-selling author he is a philanthropist for 13 years he ran fidelity'... Read More

Summary

In this video, Peter Lynch, a legendary investor and former manager of Fidelity's Magellan Fund, discusses his career, retirement, and passion for education. He shares insights into his investment philosophy, the changing landscape of the market, and the importance of listening and communication skills in successful investing. Lynch also talks about the need for improvement in the education system and his dedication to supporting educational initiatives through his foundation.

Questions & Answers

Q: Why do people buy stocks that have fallen in price?

People buy stocks that have fallen from their previous price because they believe it is an opportunity to buy at a lower price. This practice is known as "bottom fishing" in the stock market. However, it is important to note that buying solely based on price does not guarantee success in investing.

Q: Why did Peter Lynch retire from managing the Magellan Fund and what has he been doing since?

Peter Lynch retired from managing the Magellan Fund at the age of 46 in order to spend more time with his wife and family. Since then, he has been working part-time with younger analysts and dedicating his time and resources to philanthropy, particularly in the field of education.

Q: What has Peter Lynch learned since retiring from the investment industry?

Since retiring, Peter Lynch has had the opportunity to see his three children grow up and spend time with his grandchildren. He emphasizes the importance of family and cherishing these precious moments. Additionally, he has become passionate about improving education and addressing the challenges faced by the American education system.

Q: What are Peter Lynch's passions outside of investing?

Peter Lynch and his wife Carolyn are passionate about improving the education system, particularly in K-12 schools. They believe that while America has some of the best colleges and universities in the world, there is a need for improvement in primary and secondary education. They are dedicated to supporting initiatives that address this issue and ensure that children receive a quality education.

Q: Why does Peter Lynch think that the American education system needs improvement?

Peter Lynch highlights the fact that the American education system is lagging behind in terms of high school graduation rates and performance in math, science, and engineering compared to other countries, particularly in Europe. He believes that there is a need to focus on K-12 education and ensure that students receive the necessary skills to thrive in today's technological and globalized world.

Q: Why does Peter Lynch think that improving education is important?

Peter Lynch believes that education is crucial for the future success of individuals and the overall progress of society. He emphasizes that a high school dropout today is at a significant disadvantage in finding decent and challenging job opportunities. Additionally, literacy plays a critical role, as there is an alarming correlation between illiteracy and the number of people in prison.

Q: Why has there been a lack of progress in improving education despite the resources and voices dedicated to the cause?

Peter Lynch believes that one of the major challenges in improving education is recognizing the extent of the problem. He believes that only recently has there been a growing recognition of the issues faced by the education system, particularly in public schools. However, he points out that progress is being made, with initiatives such as Teach for America and national mentoring programs, which demonstrate that positive change is possible.

Q: Does Peter Lynch think that we have the will to improve the education system?

Peter Lynch believes that the key to improving the education system is increasing awareness and recognition of the problem. He believes that as more people recognize the issue and understand that they can make a difference, the necessary willpower and resources will follow. He cites examples like Teach for America and charter schools in Massachusetts as positive steps that show what can be achieved when people invest in and support education.

Q: Are all charter schools successful in improving education?

Peter Lynch acknowledges that not all charter schools have been successful in improving education. He mentions that some early charter schools were not well planned or thought out, resulting in less than desirable outcomes. However, he asserts that there have been significant improvements in charter schools, along with some district schools, proving that when properly executed, these programs can make a positive difference in students' education.

Q: What makes a great manager or leader?

According to Peter Lynch, great managers and leaders excel at problem-solving and have the ability to manage and motivate people effectively. He emphasizes the importance of listening and communication skills, understanding the needs and aspirations of one's team, and setting clear goals. He also discusses the difference between persistence and stubbornness, noting that great leaders know when to be persistent and when to adapt and make necessary changes.

Takeaways

Peter Lynch's insights into investing and education highlight the importance of being informed, curious, and adaptable. He emphasizes the value of conducting thorough research and understanding the businesses one invests in, as well as the significance of listening and effective communication in leadership. Additionally, Lynch's passion for improving education underscores the need for recognizing and addressing the challenges faced by the American education system.