investingfromtheright

I am retired and take educated guesses on all things financial.

July 08, 2008

July 8, 2008: Sir John Templeton, Genius: R.I.P.


I was a bit surprised that the death one of the giants of the investment world, Sir John Templeton who died Tuesday, was not more widely reported. He was age 95 at passing.

John Templeton was the first of the true global investors. When Jim Cramer states "there is always a bull market somewhere and I try to find it..", John Templeton actually did it, beginning in 1937. He took risks but was almost always vindicated, and his shareholders did very well.

In 1939, he borrowed money as Hitler marched through Poland, and purchased 100 shares each of companies in the U.S. selling at $1.00 or less, including thirty-four companies that were in bankruptcy. Only four turned out to be poor investments. Templeton turned large profits on the others.

In 1956, Sir John established a technology fund (yes, you read it correctly, a technology fund) whose capital skyrocketed in the late 1950s after fund management companies were allowed to go public.

He established the Templeton Growth Fund - an historic and hugely successful international fund - which he sold in 1992 to the Franklin Group for $440m. A $10g investment when the fund was created in 1954 would have grown to $2m by the time it was sold, including expenses (a substantial load, which was common at the time).

A devout Christian, Templeton established the John Templeton Foundation in 1987 to fund projects that could reconcile religion and science. The fund was endowed with $1.5b and awards approximately $70m in annual grants. The Templeton Prize in this field is larger than the Nobel Prize in worth - which Templeton demanded. Grants have been awarded to studies ranging from evolutionary biology to love and forgiveness. He was knighted in 1987 for his philanthropic accomplishments.

John Templeton was a southern gentleman, born in Tennessee in 1912. He graduated from Yale and was a Rhodes Scholar, earning a master's degree in law at Oxford University. He later moved to Nassau, Bahamas and became a naturalized British citizen.

Sir John Templeton always seemed to find value amidst "maximum pessimism" (his words). Often times he chose companies that were foundering, yet his sense of value made him, his shareholders buckets of money.

Many of us will remember his appearances on the Louis Rukeyser "Wall Street Week" program. "Now, Louis..." became his trademark. He was always optimistic, analytical, devoutly religious and the consummate gentleman.

The investment world is a poorer place today in his absence.

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