Super Mario: Today’s Economy by Wall Street Wizard Gabelli

Mario J. Gabelli, chairman and CEO of Rye-based GAMCO Investors Inc., said the possibility of a recession is an unresolved social problem that hurts people struggling to make a living and, in turn, the broader market. I think it’s less worrying than financial problems. Photo courtesy of Mario J. Gabelli.

In April, Mario J. Gabelli received the Horatio Alger Award, presented by the Horatio Alger Association of Distinguished Americans Inc. This award honors leaders who have overcome adversity to achieve professional and personal success.

As Chairman and CEO of Rye-based GAMCO Investors Inc. (formerly Gabelli Asset Management Co.), Gabelli is one of the most prominent analysts and investors in the financial services industry today. And Horatio his Algiers famous story-deserving life. I was.

Gaberi from the age of 12 I travel from the Bronx to work as a caddy at an upscale country club in Westchester County. Sometimes I go by bus, sometimes I hitchhike. But rather than golfers going home after a game, they were hanging around and listening to adults discussing the stock market.

“They were specialists from Wall Street,” he recalls, noting that he realized the value of the investment from conversations at the country club. “I entered the stock market at the age of 13.”

Gabelli attended Fordham University, graduating with honors in 1965 and earning an MBA from Columbia Business School in Manhattan. When he left school, he got a job as a security analyst at his Loeb, Rhoades & Co. After nearly a decade, he felt ready to start his own brokerage firm and named it his Gabelli & Co.

“I had a very focused and knowledgeable experience of all money managers in the country for 10 years,” he says. “And I thought I could raise some money to start the company. But they wanted a salary, so no one joined me.”

Gabelli made $5,000 in her first year in business. This was due to “selling industry-specific research results to institutional investors for a fee. ” concept, and labor costs rose significantly while interest rates rose dramatically. ”

In today’s economy, inflation is at levels not seen in decades, and Gabelli sees the situation as an example of economic déjà vu.

“The degree to which the Federal Reserve miscalculated the impact on the enormous amounts of money put into the system is the late 1940s, when individuals were working off-duty during World War II but could not buy anything. It reminds me,” he says. “And when the war ended, there was a shift to consumer goods, and the prices of commodities, housing, etc. skyrocketed. After a couple of years, it calmed down and inflation was fine.

He then pointed out that the 1970s was complicated by the energy crisis, which exacerbated a stagnant economy.

“We had to stand in line to get petrol and prices skyrocketed,” he says. “But the real concern at the time was the price cost caused by wage price inflation.”

In today’s economy, Gabelli worries that wage growth has lagged higher prices for consumer goods, fuel and utilities, and that low-income households will be particularly affected if the economy deteriorates further. In his view, the possibility of a recession is less important than the lack of an economy. Solving underlying socio-economic problems that quietly migrated during the boom years.

“From my perspective, if it’s a recession, it’s it,” he says. “That’s not what I’m worried about from an investment perspective. I’m worried about the impact on society. And the question is how bad is it? How long will it take? How much better and which sectors of the stock market will benefit? While my comments contain some social considerations, they are really driven by the economic impact on the public markets. ”

Looking across today’s economy, Gabelli is aggressive in the defense and aerospace industries, warning that the Pentagon needs to be more aware of the existential threats surrounding the country.

“At a time when China, North Korea and Russia are aiming hypersonic missiles, the Minuteman Defense System we installed about X years ago reminds us of the Maginot Line installed by France before World War II. he says. “We are hypersonic and far behind” — missiles fly at more than five times the speed of sound, or Mach 5 or more.

Gabelli is also interested in the potential of blockchain technology, but is less enthusiastic about cryptocurrencies supported by this digital system.

“I love blockchain,” he says. “If I sell a stock today, the customer will not receive the money for two days. So the concept of being able to settle in real time is accelerating. I bought it for $525 and sold it for $525.

Gabelli adds that many novice investors in their 20s are plagued by online trading, which they have embraced too enthusiastically in recent years.

“If I’m 22 or 24, that means I started playing Pac-Man,” he says. “They are very knowledgeable about electronic games. to buy and sell securities without

Financial literacy “should be taught in grammar schools and high schools,” he says. While it’s encouraging that young people “have a little more understanding of how capital is distributed in a free market system,” he admits, “the bad news is that they need more training.” there is

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