T. Rowe Price

Chapter SixteenINVESTING FOR THE DECADE, 2017–2027

This chapter falls outside of the period of Mr. Price's lifetime and is based entirely on the author's and Bob Hall's' speculation as to how Mr. Price and his investment concepts might approach today's markets.

Mr. Price had two distinct advantages over most other investors. He was an innovative visionary and a gifted soothsayer. In addition, he was extremely focused on the business of investing, literally reading reports and studies on that subject from the time he woke up at four in the morning until he went to bed at nine‐thirty in the evening. During his prime, before he retired from the firm, he only took time out from these studies for meals, occasional dinners with good friends, and preparation for and participation in meetings with clients and mutual fund advisory committees.

In the 1930s, he had the vision and foresight to develop the Growth Stock Theory of Investing. Described in more detail in earlier chapters, this was the concept that one might achieve superior investment results with a program based on the commonsense concept of buying and holding only the stocks of companies that had the ability to sustain superior earnings growth over the long term. This was far ahead of his time. In the years immediately following the Great Depression, the emphasis was not on investing for the future, but on the preservation of one's remaining capital.

Even today, many investors put their money into stocks that they believe ...