Chapter 8. On Global Investing: Acres of Diamonds

"Acres of Diamonds" is the title of a classic lecture by Dr. Russell Conwell, founder of Temple University. He delivered his talk the world over during the 1870s and 1880s, long before this era of mass communication, and his words inspired millions of people. Dr. Conwell told the story of an ancient Persian named Al Hafed, a wealthy man who sought even greater riches. One night, he dreamed of finding a great diamond mine. Soon after, he set off on a search for it that would take him to every corner of the ancient world.

The quest forced Al Hafed to spend all his wealth. Despondent, he cast himself into the sea at the Pillars of Hercules, sinking beneath the foaming crest of the tide. Later, on Al Hafed's very property in Persia, so Dr. Conwell's story goes, "his successor led his camel to the garden brook and noticed a curious flash in the shallow stream, and pulled out a black stone with an eye of light, reflecting all of the colors of the rainbow." He had discovered in Al Hafed's garden the Golconda diamond mine, which was to yield some of the world's greatest diamonds, including the Kohinoor diamond that is treasured among England's crown jewels.

The moral of the story is clear and simple: Stay home and dig in your own garden, instead of tempting fate in an alien world. You will find "acres of diamonds" right where you are.

The more I read about investing outside the United States, the more I think about this story. I am not suggesting ...

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