Celestial Navigation

I was at a family wedding this weekend. A number of my relatives flew into London for the occasion. At the dinner I ended up sitting next to one of my uncles who served in the education department of the Indian Navy for his entire career. He is eighty this year and complaining that the college he teaches at keeps dragging him back each year as they can’t find anyone else to teach his subject.  

In my entire lifespan that I’ve known him, I’ve somehow never managed to ask what he has taught for over 50 years. So what keeps you employable into your 80s - apparently teaching celestial navigation to merchant navy and defence navy officers in training.

Celestial navigation - or steering a ship with just the use of your position relative to those beautiful stars in the sky. It’s how sailors sailed to faraway lands for hundreds of years before the advent of modern technology such as GPS. Although it sounds old fashioned, many naval training schools require it in case modern technologies break down.

The US Naval Academy stopped teaching celestial navigation a while back given all the navigational wizardry on their ships. Recently with the threat of cyberattacks and potential jamming of signals during war, the US Navy has brought back celestial navigation as a basic requirement!

Imagine being on the high seas, with only a few stars to steer you by. This is very, very hypothetical for me as I get seasick taking my kids out on a rowboat on our local lake…

What happens as investors if we got rid of our directional technology --- the Bloomberg screens, the interminable meetings, the blinking phone apps and stock price tickers on our screens?

I don’t think I’d bother calculating anything more than a P/E ratio. Even that might be too hard without a calculator.

Here are the two stars I’d look for if I had to give up all my wonderful financial research and news subscriptions:

  • Looking for investments that have the potential to double in 3-5 years

  • Cash flow - strong cash flow

In the kinds of investments you make, what is your North Star when all the overabundant data and analysis sails away?