Esquire magazine investing columnist Ken Kurson has planted a big wet one on GFI Group Inc., a Wall Street firm founded, run and majority-owned by Rumson’s Mickey Gooch, who co-owns the Two River Times with his wife, Diane Gooch.
The September issue has Kurson exhorting readers to invest in GFI not in spite of the near-impossibility of their ever understanding what the company does, but precisely because of it.
GFI specializes in something called “credit-default swaps,” products that are, as Kurson says, “impossible to explain and of use to a tiny percentage of people.” But never mind that, because industries that are easy to understand attract way too much attention for anybody to make money on anymore. Besides, GFI is the leader in its multi-trillion-dollar industry, whatever it does, and Kurson has an analogy we can all understand. He writes, “If GFI sold hamburgers instead of hookups between those who buy and sell complex derivatives, the buzz about it would be unstoppable.”
Moreover, there’s absolutely no downside to GFI Burgers, or none that Kurson finds worth interrupting his hummer to mention.
OK, so in the penultimate paragraph, Kurson casually informs the reader that he bought “a few hundred” shares of GFI for $26 each soon after its IPO in January 2005, and has since added “a couple thousand, picking up more each time the stock dips below 50.” “You ought to do the same,” Kurson advises, turning the “buy-what-you-know” simplicity of investment gurus Peter Lynch and Warren Buffet on its head.
Oh, and by the way, Kurson adds, “I should mention that GFI’s CEO, Mickey Gooch, has become a friend of mine.” Pesky ethical requirement of the journalism game, you understand.
Anyway, there you have it: a rave from a completely disinterested party. Let’s have some of those GFI Burgers!