Business leaders teach students the value of a dollar
March 9, 2006
Wall Street, 1792.
Twenty-four stockbrokers gathered beneath a Buttonwood tree and signed an agreement in the streets that founded what later would become the foremost institution of financial wheeling and dealing.
More than two centuries later, a group of teenagers sat in a third-floor classroom at Moffat County High School listening to a local broker discuss what eventually became known as “the Big Board” or, more specifically, the New York Stock Exchange.
Forty–four years after its inception, board members banned trading in the streets, but the fundamental principle of what is now the world’s largest stock exchange — buying and selling shares of public companies — is just as alive as ever.
“About the only business that gets conducted in the street now is illegal,” broker Dean Brosious jokingly said to students during a presentation Thursday.
His presentation was part of a program, sponsored by two local organizations, that aims at improving the economic futures of students.
New Frontiers for Girls and Women, along with the Boys & Girls Club of Craig, co-sponsored “Money Matters,” a course designed to teach sound financial practices to local students. About 15 high school juniors and seniors took part in the program.
The program, which began Feb. 27 and concludes today, has covered financial lessons in areas such as real estate, loans, insurance, credit debt and continuing education. Local business leaders from throughout the community covered the topics.
On Thursday, Brosious chatted about success stories — and flameouts — of stock exchange and corporate trading lore. The reason companies go public, he said, is it’s “easier to attract large amounts of money.”
For instance, when three Colorado residents invented a shoe called “Crocs” and noticed the footwear was “really comfortable to wear” they decided to take their company public. In their Initial Public Offering, the company sold nine million shares at $30 per share.
“Those are some very wealthy people. But the real payday came when they sold the stock publicly,” Brosious said.
However, an investment that at first appears like a hidden gem soon can become fool’s gold.
Brosious said the company producing Crocs has yet to diversify, and foreign competition soon will start producing similar products at cheaper prices. From its initial offering, the company’s shares have slipped to $25 a piece.
“It’s a fad,” Brosious said. “That’s just not a stock I would recommend to people.”
The same can be said of investing in satellite radio, the new wave in radio that heavily markets itself as commercial-free, Brosious said.
“They can’t make the thing work without some commercial advertising,” Brosious said.
Brosious also discussed Kenneth Lay — the embattled former chief executive officer of Enron currently on trial for bilking investors of millions of dollars — as an example of a Gordon-Gecko-like financial villain.
“He was fairly destitute. He was down to about five houses in Aspen,” Brosious said. “It’s hard for people to feel sorry for him.”
Google.com, on the other hand, is a sound investment, the broker said.
“(It’s) a machine,” he said. “They have the horsepower and they’re making so much money now they’re branching out into other areas.”
Local businesses — Solutions Oriented Systems, Jackson’s Office Supply, Cashway, Kum & Go, McDonald’s, Maurices, Kmart and The Copy Shop — contributed prizes to students who participated in the two-week course.
Students who took part in “Money Matters” gave up all or parts of their lunch hour to participate. Senior Jake Bilodeau said the sacrifice was well worth it.
“We learned how important it is to establish good credit,” Bilodeau said. “As soon as we turn 18 they told us to get a credit card, buy small things and pay them off right away.”
Patti Askew, of New Frontiers and the Boys & Girls Club, said “Money Matters” was an apt topic for the ambitious students to cover.
“I wanted a subject that the kids will be confronting soon,” Askew said. “As far as I’m concerned, anything that we can get into their heads now will only help them down the line.”
Josh Roberts can be reached at 824-7031, ext. 210, or email@example.com.