News and Opinion from Sisters, Oregon
News and Opinion from Sisters, Oregon
October 19, 1987, was the worst day of Greg Donaldson's professional life.
On that day, known to history as Black Monday, the stock market suddenly cratered, in a one-day plunge that pulled down the Dow Jones Industrial Average by 22.6 percent, and wiped out $1.71 trillion in wealth. Donaldson was sure that it had wiped out his small investment firm, too.
That's not what happened. In fact, the week following Black Monday marked a sea change in Donaldson's understanding of his work, and created a new path for him and his firm. Donaldson, who lives part-time in Sisters, recounts that journey in his memoir, "The Hidden Power of Rising Dividends."
On the Friday after Black Monday, a client came in with two large accounts that he wanted Donaldson to manage - with a stipulation: He wanted only dividend-paying stocks.
"I was a pure growth investor at the time," Donaldson said.
But Donaldson was in no position to quibble. He took on the accounts.
"He essentially rescued us," Donaldson said. "He didn't know it at the time."
Donaldson began researching "slower-growing companies, a little more dominant in their industry. Blue Chip. And they all paid dividends."
Upon deep study, Donaldson concluded that these companies - when dividend payouts were figured back into the equation - were outperforming the S&P 500.
"That was the first whiff of a notion," he recalled. "It was shocking to me, so my heart got a lot more interested in studying these things."
Donaldson became so immersed in this study that he became an expert in dividend investing.
His firm was able to guide clients outside the dot-com bubble that burst going into 2000, with his investments climbing while the S&P fell.
Greg Donaldson has crafted a memoir of a revealing journey through the world of financial investment.
He began to blog about the strategy, and was eventually approached by a publisher to write a book on the subject. The timeline was unrealistically tight, so Donaldson put the project aside. But the idea of writing a book stayed with him.
He started putting something together, and asked his son Nick for input. Nick told him the work was "too dry and mathematical." He told his father that, "the story of how you came to learn it is much more interesting than what you came to learn."
Donaldson took his son's advice to heart, and "The Hidden Power of Rising Dividends" became in large part the story of Donaldson's journey. The story has resonated - and so has the practical strategy. One reviewer noted:
"...Quite apart from the narrative quality of Donaldson's writing, the investment strategies and nitty-gritty descriptions of financial markets in this book are in-depth, coherent, and eminently readable. The text offers practical, articulate explanations of the relationship between inflation and interest rates, of the varying types of bonds and the difference between investment strategies. Each of the many characters that converse with Donaldson over the course of his journey expose a different mentality and perspective on investing and, cumulatively, the book captures a huge swath of financial ideas that will allow readers to make more informed choices about how their money is handled."
"Inspiring on many levels, 'The Hidden Power of Rising Dividends' is a rare find-a mesmerizing account of one man navigating the ins and outs of investment strategies. It combines arcane financial ideas with an intimate, memoiristic narrative and literary prose. The result is a book that readers will not want to put down and might even make a few non-investors change their mind about the market."
Donaldson wrote his book during summers spent in Sisters, where he and his wife Joyce have a home in Pine Meadow Village. They discovered Sisters when their son Nick was playing soccer at Oregon State University. Their other son, Justin, also attended OSU doing doctoral work.
Greg recalled that he was back at work in Indiana when his wife called him from Black Butte Ranch and told him, "Greg, I think I've found the most beautiful place on earth."
They bought a condo here in 2005, then the house at Pine Meadow in 2014.
Work keeps Donaldson rooted to Evansville, Indiana - for now.
"If we didn't have responsibilities in Indiana, we'd be here six months, eight months, nine months out of the year," he said.
Donaldson emphasizes that his memoir is fundamentally a tribute to his clients.
"It was their idea, and we just listened to them," he said.
"This is also about how to build a business," he said. "You've got to stay in the truth, and you've got to stay in what you know and understand."
"The Hidden Power of Rising Dividends" is available at Paulina Springs Books in Sisters.
Jim Cornelius is editor in chief of The Nugget and author of “Warriors of the Wildlands: True Tales of the Frontier Partisans.” A history buff, he explores frontier history across three centuries and several continents on his podcast, The Frontier Partisans. For more information visit www.frontierpartisans.com.
Reader Comments(0)