06/01/19 YOUR INVESTMENT SEMINAR IS IN...LAS VEGAS

YOUR INVESTMENT SEMINAR IS IN...LAS VEGAS

You come to Las Vegas expecting to lose money, right? Don't tell that to the more than 9,000 investors who in mid-May descended on Bally's for the Money Show, billed by promoters as ''America's #1 Marketplace for Actionable Investment Advice.'' It was four days under the Big Top for mostly serious individuals bent on sampling the cornucopia of investment ideas on display.
Scores of advisers, data services, and mutual-fund companies brayed for attention with workshop titles like ''Scrooge Investing'' or ''Why Women Make Better Investors.'' Companies as diverse as Intel (INTC) and electric scooter maker ZAP Power Systems rented booths to promote themselves as investment possibilities. Meanwhile, in the center ring, celebrity Wall Streeters such as media mogul Michael Bloomberg and newsletter writers John Dessauer, Al Frank, and Michael Murphy flung market views and stock tips to the crowd at the behest of the sometime master of ceremonies, Wall Street Week host Louis Rukeyser.
SCARED. Before soothing one luncheon crowd with his steadfast bullishness, Rukeyser reminded them that ''most people are scared to death about money.'' If so, many at the Money Show were dealing with their fear in dead earnest. Yes, some attendees did have that dazed look of half-fleeced sheep. One old guy, for example, had borrowed $14,000 on a MasterCard to invest in oil and gas wells for retirement income. Then there were the crowds around the exhibit booth for Castle Superstore, a group of seven ''adult products'' outlets hoping to raise $5 million to expand. ''Half the people in America won't visit our stores,'' its banner proclaimed. ''We're making millions off the other half.''
But far more popular were the dozens of outfits showing online investing software, sites, and services. And more typical were patrons like John McBurney, a retired Ford Motor executive who stopped on his way to a workshop to make a point: Big stocks, not small, are the key. McBurney said he started out a few years back with $700,000 and plowed it into such mega-stocks as Citicorp and AT&T. How big is his account now? McBurney held up four fat fingers. ''Four million,'' he said. ''Look how well I've done, and I'm so stupid.''
McBurney goes to these shows repeatedly to find new ideas. That's common. Money Show organizers claim more than half the attendees are repeat customers. Most are 55 or older, count a net worth of $1 million or more, and manage a liquid investment portfolio of at least $400,000. You'd think most want a hot stock to snap up, but I found little evidence of that. What impressed me about dozens of investors I met was their thoughtfulness and patience.
Take John Urquhart. A retired electrical distributor from Scottsdale, Ariz., who is focused on estate planning, Urquhart said he was mainly after ''good strategies, to polish up what I'm doing.'' And Nick Muscato, a 42-year-old software executive from Orlando, said the last time he attended a Money Show, comments from professional tech investors served to confirm his own industry research on companies like Dell Computer and Intel. ''A lot of things they were saying really hit home,'' he said. At this show, he was searching out plays on banks that might be merger candidates.
Sandeep Vijay, a Las Vegas internist who trades stocks and options, said he was all ears when mutual-fund managers at the show talked up stocks they had bought. But he added: ''They want you to go buy stocks they already own, so the value of their fund goes up. Of course, they don't tell you this.'' He's counting on turnarounds at Boston Chicken (BOST) and Novell (NOVL). And Jill Wilson, with dough to invest since she sold her real estate development company, said she took careful notes on the stocks recommended by Rukeyser's lunchtime panel of experts. One such pick was Magna International, a Canadian auto-parts maker that Louis Holland of Holland Capital Management thinks will benefit from the Chrysler(C)-Daimler Benz (DAI) merger. But Wilson was in no hurry to call her broker: ''I'll probably go back home and look up some of these.''
The sober approach of so many of the folks made me wonder what had happened to the prototypical small investor, the odd-lotter who is always late, always wrong, and always the fool. ''Much of Wall Street has been predicated on the myth of the dumb individual investor,'' observed Morningstar President Don Phillips during a panel discussion on investing via the Internet. But technology's ability to deliver investment information broadly and cheaply is destroying that model, he said, and investment firms must adapt to survive.
In a similar way, the Money Show itself has been forced to evolve. It is the brainchild of Charles Githler, who looks as if he could be Charles Schwab's baby brother and is a devotee of Ayn Rand's libertarian philosophy. Two decades ago, at age 22, Githler put on his first investment seminar in San Francisco. In that era's high-inflation, doomsday atmosphere, investors were drawn to conferences on gold and other hard assets. Githler figured there would be a market for symposiums not just on hard assets but on stocks, bonds, and mutual funds. As these conferences took off, they drew such pricey, high-visibility acts as economist Milton Friedman and another Rand believer, the pre-Federal Reserve Alan Greenspan.
Githler charged attendees accordingly-- up to $895 a head. At that price, hundreds, not thousands, turned out. Then came the crash of 1987, and attendance plunged. Also cutting into registrations was the growing savvy of investors, who found themselves able to get much of the same information more cheaply through TV, magazines, and, ultimately, the Internet. ''People were not willing to pay that kind of money anymore,'' recalled Githler's wife, Kim.
Pressed, the Githlers came up with a different idea. Why not make the shows cheap and easy for investors to attend and ask newsletter publishers, advisory firms, mutual-fund houses, and anyone else eager to get a message across to foot most of the bill? Sponsors would then offer clients free or low-cost tickets. The scheme clicked. By last year, the Githlers were staking their tent in Orlando, Las Vegas, Chicago, Seattle (think Microsoft millionaires), and San Francisco, where a record 12,000 attended. They offer cruises, plus a similar, barely profitable show on health topics. They also plan to launch a show for small business owners by 2000.
The Githlers' private Sarasota (Fla.) company, InterShow, expects a net margin of 15% to 20% on revenue this year of $10 million to $12 million. ''We are about a face-to-face experience, teaching people to take control of important and passionate areas of their lives,'' said Kim Githler, who runs operations with a staff of 55.
Investors at the Money Show come looking ''for an edge,'' she said. ''They're looking for an idea. Their energy is about achievement and getting the most out of what they're going to do.'' Evidence? Her group tends to gamble less than the standard Vegas crowd, a fact that she said is reflected in hotel room rates that are 20% higher than average.
But what of retirees who might lose money in some cockamamie oil venture or electric-scooter franchise? The admission standards for exhibi- tors are getting stricter, she said, but the process is mostly laissez-faire: ''We're just continuing to allow the market to squeeze out'' the schlock, Charles Githler said. ''Some are riskier than others.''
Tony Sagami, president of HarvestAdvisors.Com, has attended shows frequently since 1988 and agrees that exhibitor quality has edged up. Yet he thinks the Githlers' business model still hurts. Because they get ''their revenue from the exhibitors and not the attendees, they are inadvertently attracting the rip-offs,'' he said. As chief beneficiaries of the show, the Githlers are happy to let the patrons sort out the serious players from the clown acts.
Robert Barker
EDITED BY AMY DUNKIN