Nathaniel Thiele

I have decided to make a 100-page ebook based on the stock market. Here is the first page.

Stocks create meaningful wealth 

The value of $1 dollar invested into various sectors from the 1900s to 2019

Stocks have created meaningful wealth for a variety of investors. The chart above it shows that certain sectors outperform while other sectors underperform. In this book, we get a clear understanding of how to create meaningful wealth with dividend stocks. 

In this chart for the USA, the top-performing sector was tobacco. Why would a product that had declining revenue and very little growth opportunity give such great returns? Tobacco is a cash cow for governmental agencies. 

Most of the tax revenue for state governments comes from taxing tobacco. In return, the governments have guaranteed that these companies exist for a long time. I want to show a short story about the industry as a whole.

In the 1800s, big Tobacco was controlled by a company called American Tobacco Company. It was a legal monopoly. After the company was split up into 5 companies which would be considered an oligopoly.

By buying out competitors, American Tobacco Company had increased from 80% market share to over 90%. American Tobacco Company broke into five companies that were broken up American Tobacco Company, R J Reynolds, Liggett and Meyer, and Lorillard. 

The American Tobacco Company decided to diversify itself from tobacco by buying life insurance, office supplies, golf products, home & hardware, and alcoholic beverages. 

As the company diversified, The company was renamed American Brands, but later changed to Fortune Brands. They sold the tobacco division in 1994 to British American Tobacco. They then sold the insurance company to American general which later became AIG. 

They spun off the office supplies and merged with General Binding Corporation to form ACCO Brands. The golf division was sold to Puma and Fila. 

Left with two-division Fortune Brands decided to separate into two separate companies. These companies were Beam Inc and Fortune Brands Home and Security. 
Beam Inc was later merged with Suntory which is a Japanese company that produces alcoholic and tea beverages. Fortune Brands Home and Security remains a public traded company and is currently in the S and P 500 with a market cap of 9-12 Billion dollars.