What Hermes Taught MeQT

Hi, Kevin O'Leary, investor at large.

I've just come back from a shopping trip and learned a very important lesson. You know I love Hermès fantastic ties. What I hate about them is the price. So, I like to shop for volume, see if I can get a discount.

I went to the store in Geneva, and I tell you, I like to buy those radioactive bright ties; you know the ones that you need a battery just to keep them lit up because they look great on television. I'll tell you, I think these things are the best in the world. Look at this one, for example! How often can you get the purple tie? It's radioactive. Hmm, just love it; that's Hermès.

But wait, there's more. I like to shop for a lot when they get Hermès rainbow of colors, and this year's design, little HS, is just perfect. So, I go up to the counter and I say to the lady, "I bought five, how about a discount?" You know, I'm a bit of a Phoenician; it's sport to me. I don't mind spending two hours getting a five percent discount.

And she looks at me and she says, "Why you buy somebody ties if you can't afford them?" I thought she was insulting me. I said, "Well, no, no, I want you to step up and buy a lot of ties from you, even though they're outrageously expensive, but I'd like a twelve percent discount knowing that I’d settle for five."

So, she says to me, "But why don't you wait till next month's paycheck, and then you can buy another tie?" And I said, "No, no, no, no, a discount! I want a discount." I couldn't believe it—no discount! I was there for about 30 minutes; there was no way she was going to give me one.

Two important lessons here, I think, from an investment point of view: number one, brand. I wanted those Hermès ties; I ended up paying full price for them, and it killed me. I wept like a child on the way home, broken.

But secondly, think about the last couple of years—Thanks giving mortgages to people. If they had the same attitude and said, "Why are you buying a house you can't afford?" we wouldn't be in this mess we're in today. Sometimes there are things you can't own because you can't afford them, and that's okay.

Just a thought from your investor at large, Kevin O'Leary. Until next time.