“I have to believe that when things are bad, I can change them.”
James J. Braddock
Parents know no pain inflicted on them that can compare to watching their child suffer. Such was the horrific scene, portrayed masterfully by Renée Zellweger, in 2005’s Cinderella Man, the biographical film about boxer James Braddock’s against all odds rise from the depths of poverty to wealth during the Great Depression. As was the case with countless investors, Braddock lost his life savings in the stock market crash of 1929. The film is jolting as there’s no visual transition between what was plainly a middle-income, happy existence that Braddock shared with his wife, Mae, and his growing brood, to a dark and freezing slum. While director Ron Howard could not find photos or accounts of the Braddock family during the worst of their times, Mae and Jim Braddock’s granddaughter did provide letters Howard said, “were incredibly poignant and moving which described some of that, mostly gave us a real sense of the disappointment that Braddock felt at not being able to take care of his family.”
The “some of that” refers to Braddock’s promise to his son that he would not be sent away to stay with family who could provide food and shelter. With the electricity turned off in the depth of winter and a sick child shivering and weakening, Mae’s spirit was broken despite her fealty to her husband. She did what any mother in similar circumstances would and swept them to the safety of her family. On the big screen and in real life, reneging on his promise to his son was as rock bottom as Braddock would fall, forced to beg for the $19 he lacked to get the power turned back on in his hovel. Though a slight man, a natural light heavyweight, he fought above his weight to the heavyweight division. Such was the love Braddock had for his family that he did the impossible with grit and pummeled pride driving him every minute. As Marc Cerasini, who authored the book Cinderella Man, wrote: “Those who are willing to put in the hard work will get the rewards they want.”
Investors these days have to put in about as much work as their 1928 and 1929 counterparts did. Speculation is rife and the only money to be made is easy money. The mere mention of valuations is enough to get most sell-side strategists and money managers fired on the spot. Robert Shiller’s Cyclically Adjusted Price-to-Earnings Ratio is at 40. Period. End. And yet, mentioning it or any other metric that needs a taller scale to properly depict historically is akin to saying Voldemort at Hogwarts. There are a handful of exceptions. Bank of America’s Chief Investment Strategist Michael Hartnett is one of them.