Friday, November 14, 2008
The death of the bull market in cosmetic medicine (?)
Sorry for the extended break!
Lots going on with the practice and the increasingly complex undertaking of building out a new office and surgery center while the country is treading water with the financial markets. There's lots of anxiety in Plastic Surgery these days as people's disposable income is drying up for cosmetic surgery, injectables (like BOTOX & Juvederm), and noninvasive laser treatments (IPL, hair removal etc..).
A number of medispa outfits have gone bankrupt, stock prices for major players in cosmetic medicine like Allergan & Mentor have fallen faster then other stocks of similar market cap size, and practices across the country are reporting flat or negative growth for 2008. Just today I heard that Rhytec, maker of the innovative Portrait Plasma laser resurfacing system is shutting down, potentially leaving owners SOL for replacing the disposable treatment tips on their expensive laser machines.
I've been obsessed reading a number of books about financial history, market theory, and asset allocation. I can't recommend enough the classic book by Dr. William Bernstein (who is a practicing Neurologist of all things BTW), "The Four Pillars of Investing" which lays out a very compelling lens thru which to view the ebb & flow of investment going back hundreds of years. Everything we're enduring now has happened in some form or another somewhere in history, and about once a generation we should expect the world markets to go crazy. It's ironic that if you're early in your adult life, the current events may make the best time to invest heavily in equities that you will ever see during your lifetime (in the "buy low, sell high" sense).
I'm thinking of this as I'm reading an article by Michael Lewis in today's Portfolio magazine "The End of Wall Street's Boom". Lewis is the author of the classic baseball book "Moneyball" and the 1980's wall street classic expose "Liar's Poker". This article revists the same territory of "Liar's Poker" and is a fascinating look at the insanity/stupidity of the Wall Street culture in priming the pump for our current problems. It really dovetails nicely with Bernstein's book at exposing what fools we mortals be!