Inside today’s Daily Journal…

It was the greatest investment I have ever seen – or will ever see.

In September 2010 Steve Sjuggerud, writing for Stansberry Research, published “The Greatest Unknown Investment Story On Wall Street.”

It wasn’t a stock he was talking about. It wasn’t even a company. It didn’t have any employees. It was a trust set up in 1888 to liquidate the assets of a failed railroad: 3.5 million acres of West Texas desert.

By 2010, the Trust still held nearly 1 million acres — and had accumulated 110 consecutive years of positive earnings, 53 straight years of cash dividends, no debt, no employees to speak of, and no investment-banking business for any Wall Street firm to chase. CEO Roy Thomas told Steve on the phone: “Well… I don’t remember ever losin’ money, if we did.”

Steve understood the key, driving principle that had safeguarded the investors in the Trust for more than a century: by law, the Trust had to return every dollar of after-tax cash to shareholders — through dividends or buybacks. Management chose buybacks. With 10 million shares outstanding and 300,000 shares retired every year out of oil and gas royalty cash, every existing holder’s slice of the land base grew at roughly 3% per year — tax-free.

And then Sjug walked our subscribers through what this would mean through time:

He was publicly mocked by a competitor for that logic. But, of course, Sjug was damn good at math. And he was exactly right. The mechanism was simple arithmetic. Fewer shares every year. Compounded for 30 years. The chart in the issue projected a single share by 2040 worth more than $600 million.

Stansberry Research told subscribers to buy Texas Pacific Land (TPL) at $27 (pre-split) in September 2010. TPL has split twice since the recommendation — a 3-for-1 in March 2024, and a 3-for-1 in December 2025. Every share Sjuggerud’s readers bought is now nine shares. Today TPL trades near $300. A $10,000 stake at the September 2010 issue price — 370 shares at $27 — is now 3,333 shares worth roughly $1.0 million. A hundred-bagger. In 15 years. That is a 34% compound annual return. The S&P 500 over the same window compounded around 12%. Sjuggerud’s readers beat the index by roughly 22 percentage points a year, every year, for a decade and a half. And it continues to compound.

A perfect investment.

And Steve wasn’t the first great investor to notice. Murray Stahl personally began buying Texas Pacific shares in the 1970s. The stock then traded around $0.36–$0.65 on a split-adjusted basis.

And Murray didn’t tell a soul about it until May 8, 1995. That’s when his Contrarian Research Report published “How To Buy 1 Million Acres Of Fine Texas Grazing Land For $20.” That was Texas Pacific: 3.075 million shares outstanding, $62 million market cap, ~$54 per acre implied.

By June 2025, Securities And Exchange Commission (“SEC”) filings showed Murray Stahl personally controlling roughly 1.17 million shares. And his newsletter had become a mutual fund – Horizon Kinetics. Its affiliated vehicles owned more than 10 million shares of Texas Pacific. At pre-split prices above $900, Murray’s personal stake exceeded $1 billion. He died earlier this year, still holding every share.

That’s the art of investing.

Investments only look rational in hindsight. In real time they run on three emotions – fear of missing out, envy of the neighbor’s returns, and terror of underperforming the benchmark. The poor investor only learns, far too late, that the head is the dupe of the heart.

What’s driving investors’ emotions today is the artificial intelligence (“AI”) infrastructure buildout. As I’ve written about recently, the PHLX Semiconductor Index (SOX) just logged one of the longest streaks of consecutive up days in its history. Chip ETFs have compounded more than 1,000% over the past decade – and another 40% to 50% in the last 12 months. A tiny cluster of AI-linked names – Nvidia (NVDA), Broadcom (AVGO), SK Hynix, Micron Technology (MU), Taiwan Semiconductor (TSM) – drives a disproportionate share of every benchmark return on Earth.

When investors panic buy, capital gets pulled out of every other corner of the markets. This happens through unemotional mechanics too, through ETF flows and benchmark-hugging mandates. What have investors been selling to fuel the chip stock mania?