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Proletarian investor’s point of view: RadioShack’s Embattled CEO, David Edmondson, is our (bad) hero. One of US who showed THEM they are no better. February 21, 2006

Posted by deminvest in investment, Single stocks, stocks.
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Do you remember the movie with Eddie Murphy? “Trading Places”. Well in that movie Eddie Murphy showed what is understandable for us, the poor, the proletarians, but less clear for the big rich boys:

if we had a chance, we could be CEO of any company and we could do better that the rich snobby guys with Harvard education.

Don’t you believe me?

Well we all know RadioShach. We all did shop there, didn’t we? Well the company is huge… and it was run by a good manager: David Edmondson. The surprise was that David is like an Eddie Murphy. Apparently his resume contains two college degrees for which the school he attended has no records and several other discrepancies. Well he still did the job of CEO of a great company.

What is interesting, from our point of view, is that he could do the job, he could climb the corporate ladder, and well if we wanted we could too!

So Eddie Murphy was right!

We don’t become CEO of great companies; it is just because we don’t really want. It is not a good life and we, the great proletarian investors, prefer to own the companies those guys work for.

When some white collar (maybe ambitious) colleague of our unlucky friend David Edmonson helped the old resume come out from the dust and jump into Newspaper’s front pages, he had to resign and the company lost 8% stock value. It can mean two things:

1) We the proletarian investors, the great majority of money movers liked him and we decided to sell now that they caught him

2) The markets valued him better than his successor and considered his departure a big loss for the company.

If I had Radio Shack stocks (which I don’t) I would maybe sell them for simpathy with Edmonton. Also it is not nice to know that the new CEO begins with closing 400 to 700 stores and two distribution centers. We proletarians don’t like that!
The company is in ok health ( http://finance.yahoo.com/q/ks?s=RSH ), pays a 1.30% dividend, does not have excessive debts ( 883.30M with 5.00B sales) has still some ok earnings, although its fourth-quarter earnings fell 62 percent.
Well I know what you’re thinking smart proletarian investor… Who knows how many of us, disguised by “inaccurate” resumes are leading large and well run corporations!

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