Tuesday, June 27, 2017


"The line separating investment and speculation, which is never bright and clear, becomes blurred still further when most market participants have recently enjoyed triumphs. Nothing sedates rationality like large doses of effortless money." -Warren Buffett (2000 Letter to Shareholders)

Buffett’s Bet on Store Capital Shows Not All Retail Real Estate Is Equal [H/T Linc] (LINK)

Yoplait Learns to Manufacture Authenticity to Go With Its Yogurt [H/T @Connor_Leonard] (LINK)

Taking the pulse of ESPN [H/T @BluegrassCap] (LINK)
The sports media giant is on the defensive about a declining subscriber base, layoffs and executive changes. What happened? And what’s the plan for the future?
Google Fined Record $2.7 Billion in E.U. Antitrust Ruling (LINK)

Scott Norton talks with Patrick O’Shaughnessy on the Invest Like the Best Podcast (LINK)

Brent Beshore talks with David Perell on the North Star Podcast (LINK)

Long Now: Conversations at The Interval -- Proof: The Science of Booze: Adam Rogers (LINK)
Related book: Proof: The Science of Booze
Long Now: Seminars About Long-term Thinking -- James Gleick: Time Travel (LINK)
Related book: Time Travel: A History
How CRISPR Yanked Jennifer Doudna Out of the Ivory Tower - by Ed Yong (LINK)

Monday, June 26, 2017


"Throughout his life, a wise man engages in practice of all his useful, rarely used skills, many of them outside his discipline, as a sort of duty to his better self. If he reduces the number of skills he practices and, therefore, the number of skills he retains, he will naturally drift into error from man with a hammer tendency....Skills of a very high order can be maintained only with daily practice." -Charlie Munger

A (Long) Chat with Peter L. Bernstein - - by Jason Zweig (LINK)
Looking through my files recently, I came across a buried treasure: a transcript of the highlights of my hours-long interview with the great Peter L. Bernstein at his vacation home in Brattleboro, Vt., on July 28, 2004.
Stockpicking Is Dying Because There Are No More Stocks to Pick - by Jason Zweig (LINK)

A Dozen Lessons I Learned from Bill Gates Sr. - by Tren Griffin (LINK)

Nudgestock 2017 videos [H/T Tamas] (LINK)

Short-Seller Nailed Home Capital, Then Got Stung by Buffett (LINK)

Lessons From the Collapse of Banco Popular [H/T @Sanjay__Bakshi] (LINK)

How a Broke 30-Year-Old Failure Became America's Billionaire Tire King [H/T Matt] (LINK)
Related book: Six Tires, No Plan
Jack Ma talks with Charlie Rose (video) (LINK)

Amazon’s Nike deal took a billion dollar bite out of competing retailers (LINK)

The industrial robotics market will nearly triple in less than 10 years (LINK)

How I Built This podcast -- TRX: Randy Hetrick (LINK)

Adventures in Finance podcast: Episode 21 - Ponzi Hunters: Harry Markopolos and His Dogs of Fraud (LINK)

Grant’s Podcast: Hear, hear Jim Bianco (LINK)
The renowned fixed-income analyst discusses the flattening yield curve, the reluctant Fed and the sinking finances of his home city, Chicago.
Freakonomics Radio (podcast): Why Hate the Koch Brothers? (Part 2) (LINK)

Exponent podcast: Episode 119 — Amazon and Avocados (LINK)

The 10 Commandments of Startup Success with Reid Hoffman (The Tim Ferriss Show) (LINK)

FT Alphachat podcast: On the verge of a productivity boom? (LINK)

Edge #494: Compassionate Systems - A Conversation With Daniel Goleman (LINK)

Daniel Dennett on Tools To Transform Our Thinking (audio/podcast) (LINK)
Related book: Intuition Pumps And Other Tools for Thinking
Stoicism and Buddhism, a dialogue between Robert Wright & Massimo Pigliucci (video) (LINK)

The Risk of Rushing Through Legislation (LINK)

Why Are Bird Eggs Egg-Shaped? An Eggsplainer - by Ed Yong (LINK)

Book of the day (mentioned by Mohnish Pabrai in his latest Google Talk): The Art of Being Unreasonable

Saturday, June 24, 2017

Mohnish Pabrai: "Intensive Stock Research Can Be Injurious to Financial Health" | Talks at Google

Link to video

Charlie Munger's "The Psychology of Human Misjudgment"

The abridged and animated video of Munger's "The Psychology of Human Misjudgment" speech that has been making the rounds led me to go back and re-read the version Munger rewrote in 2005 for inclusion in Poor Charlie's Almanack. The copy I continuously go back to is from a Word file that I created in order to put the speech on my Kindle, which is a lot easier to carry around than the book. I also added a few additional things that I took from Tren Griffin's book on Charlie Munger. In case this is of interest to any of you, here is a link to that file: 

The italicized parts at the end of many sections are the additional quotes and comments from Tren Griffin's book. I noticed a few grammatical errors that I corrected when reading it through this time, and there are probably some others that I missed. If you happen to see them, please let me know so that I can correct them. And similar to Griffin's book additions, if you happen to come across other comments or examples by Buffett or Munger that might be worthwhile to add to the file, let me know that as well.

Thursday, June 22, 2017


Berkshire Hathaway Invests in Embattled Lender Home Capital (LINK)
Warren Buffett’s Berkshire Hathaway Inc. is providing a lifeline to Home Capital Group Inc., the embattled Canadian alternative lender whose near collapse sparked intense scrutiny of the country’s fraught housing market. 
Berkshire agreed to indirectly acquire C$400 million ($300 million) of the firm’s shares for a 38.4 percent stake and provide a C$2 billion credit line to subsidiary Home Trust Co., Home Capital said late Wednesday in Toronto. 
“Home Capital’s strong assets, its ability to originate and underwrite well-performing mortgages, and its leading position in a growing market sector make this a very attractive investment,” Buffett said in the statement.
Related previous link to the above (from the end of April): Home Capital Group - it is time for the Canadian regulator to act -- by John Hempton

Related video to the above: Marc Cohodes at the Grant's Fall 2016 Conference [short pitch on Home Capital Group starts around the 27:26 mark]

Canada's Housing Bubble Will Burst - by Ben Carlson (LINK)

Related to the above, from the Almost Daily Grant's commentary yesterday:
"Preliminary home price data in the formerly hot Toronto housing market is little short of shocking.  According to the Toronto Real Estate Board, the average transaction for the first half of June dropped below CAD $809,000, from CAD $863,910 in May and CAD $919,614 in April.   The reversal coincides with the introduction of a 15% foreign buyer’s tax at the end of April."
Jeff Bezos has advice for the news business: 'Ask people to pay. They will pay' (video plays) (LINK)
Bezos delivered some of this advice at the Future of Newspapers conference in Turin, Italy, on Wednesday. Here are the highlights:
  • Focus on readers first, not advertisers.
  • You can't shrink your way to relevance. 
  • Don't look for a patron or expect charity.
  • Use technology, but don't be a slave to it.
  • Advertising alone will not support investigative journalism.
  • "When you're writing, be riveting, be right and ask people to pay. They will pay."
RIGGED: Forced into debt. Worked past exhaustion. Left with nothing. [H/T @AlexRubalcava] (LINK)
A yearlong investigation by the USA TODAY Network found that port trucking companies in southern California have spent the past decade forcing drivers to finance their own trucks by taking on debt they could not afford. Companies then used that debt as leverage to extract forced labor and trap drivers in jobs that left them destitute.
John Mackey: "The Whole Foods Diet" | Talks at Google (LINK)

Uber's Bad, Awful, Horrible Week: Doomsday Scenario or Business Reset? - by Aswath Damodaran (LINK)

Malcolm Gladwell's Revisionist History podcast: "The Road to Damascus" (LINK)
In this week's episode, I track down a former CIA employee to hear the whole story, the true story, about a masterful spy and a terrorist who had a change of heart. What happened to them? And was it fair?
Freakonomics Radio (podcast): Why Hate the Koch Brothers? (Part 1) (LINK)
Charles Koch, the mega-billionaire CEO of Koch Industries and half of the infamous political machine, sees himself as a classical liberal. So why do most Democrats hate him so much? In a rare series of interviews, he explains his political awakening, his management philosophy and why he supports legislation that goes against his self-interest.
From Boardroom To Locker Room, How Joe Moglia Shocked Wall Street And College Football (podcast) (LINK)
Related book: 4th and Goal: One Man's Quest to Recapture His Dream 
Tony Robbins: The 6 Human Needs (LINK)

Wednesday, June 21, 2017


"Unfortunately in this kind of work, where you are trying to determine relationships based upon past behavior, the almost invariable experience is that by the time you have had a long enough period to give you sufficient confidence in your form of measurement, just then new conditions supersede and the measurement is no longer dependable for the future." -Benjamin Graham

Jason Zweig‏ has annotated, added links, and highlighted some of his favorite passages from Benjamin Graham's 1963 lecture, “Securities in an Insecure World” (LINK)

Farnam Street: All Models Are Wrong (LINK)

Sohn Conference Hong Kong Notes 2017 (LINK)

Energy Checklist - by Eric Cinnamond (LINK)

Brexit In Reverse? - by George Soros [H/T Santangel's] (LINK)

MSCI to Add China Shares to Indexes, Opening Market to More Foreign Investors (LINK)

It’s Lonely at the Top—or It Should Be [H/T @pcordway] (LINK)

An Early 20th Century Lesson on the Difference Between Convenience and Value (LINK)

NPR's Planet Money‏ podcast: What the Falcon's Up With Qatar? [H/T @jasonzweigwsj] (LINK)

Geoffrey West: "Scale" | Talks at Google (LINK)

Simon Sinek: "The Finite and Infinite Games of Leadership" | Talks at Google (LINK)

a16z: When We Enter the Century of Biology (LINK)

Y Combinator podcast: How Should Business Schools Prepare Students for Startups?  (LINK)

Cool Tools for Travel – Tim Ferriss and Kevin Kelly (podcast) (LINK)

This Common Butterfly Has an Extraordinary Sex Life - by Ed Yong (LINK)

Book of the day [H/T @Greg_Speicher]: One Buck at a Time: An Insider's Account of How Dollar Tree Remade American Retail

Tuesday, June 20, 2017


Warren Buffett’s Scout Inside Europe’s Biggest Economy ($) [H/T Matt] (LINK)
Zypora Kupferberg, the ‘eyes and ears’ of Berkshire Hathaway in Germany, could become more important as the company looks for new targets
Bruce Berkowitz on Bloomberg (full video) [H/T Will] (LINK)

Escaping the Magnetic Pull of a Bubble - by Jason Zweig (LINK)

Ten Valuable Insights on Structuring Your Fund (LINK)

Insurance as a platform [H/T @sanguit] (LINK)

The future of supply chains as networked ecosystems – by Sangeet Paul (LINK)

Patrick O’Shaughnessy talks with Andy Rachleff on the Invest Like the Best podcast (LINK)
My guest this week is Andy Rachleff, who is the CEO of the automated investing platform Wealthfront. Andy was also a co-founder and long-time partner at Benchmark Capital–one of the most interesting and successful venture capital firms in the world.
James Grant on the Hidden Forces podcast (LINK)

Evan Lorenz speaks with Demetri Kofinas of the Hidden Forces podcast (LINK)

The Mussels That Eat Oil - by Ed Yong (LINK)

Monday, June 19, 2017


Amazon's New Customer - by Ben Thompson (LINK)
This is the key to understanding the purchase of Whole Foods: to the outside it may seem that Amazon is buying a retailer. The truth, though, is that Amazon is buying a customer — the first-and-best customer that will instantly bring its grocery efforts to scale. 
Today, all of the logistics that go into a Whole Foods store are for the purpose of stocking physical shelves: the entire operation is integrated. What I expect Amazon to do over the next few years is transform the Whole Foods supply chain into a service architecture based on primitives: meat, fruit, vegetables, baked goods, non-perishables (Whole Foods’ outsized reliance on store brands is something that I’m sure was very attractive to Amazon). What will make this massive investment worth it, though, is that there will be a guaranteed customer: Whole Foods Markets.
Mutually Assured Destruction — What Have We Done? (LINK)

James Grant reviews “One Nation Under Gold” by James Ledbetter (LINK)

Grant’s Podcast: Rate hikes past, present and future (LINK)

Argentina Plans to Offer 100-Year Bonds (LINK)

How I Built This podcast -- WeWork: Miguel McKelvey (LINK)

African farmers’ kids conquer the marshmallow test (LINK)

"Obviously if you’re glued together and honorable and get up every morning and keep learning every day and you’re willing to go in for a lot of deferred gratification all your life, you’re going to succeed.  It may not be as much as you want.  But you’re going to success.  And so the main thing is to just keep in there, and be glued together, and get rid of your stupidities as fast as you can.  And avoid the bad people as much as you can.  And you’ll do reasonably well." -Charlie Munger (source)

Sunday, June 18, 2017


Mohnish Pabrai on The Steve Pomeranz Show (podcast) (LINK) ["Inaction and patience are very important traits, but they need to be coupled with decisiveness and willingness to act in size. So it's an unusual kind of trait to have someone who's happy watching the paint dry; but then when all the ducks line up, you swing hard.... The key is if you're not convinced you're looking at a no-brainer, take a pass." -Mohnish Pabrai]

The Tortoise and the Hare in the Pursuit of Return - by Frank K. Martin (LINK)

On GE and the myth of the CEO superhero - By Roger Lowenstein (LINK)

Did the Jack Welch Model Sow Seeds of G.E.’s Decline? - by James B. Stewart [H/T @FourFilters] (LINK)

Berkowitz Says Amazon Deal Shows Value of Physical Retailing (video and article) (LINK)

The back story on John Mackey and his battle with Wall Street, which led to Whole Foods agreeing to sell itself to Amazon last week (LINK)

GreenWood Investors: The Battle For Whole Foods Isn’t Over (LINK)

Scott Galloway on the Recode Decode podcast (audio and transcript) (LINK)
[This interview was before the Amazon purchase of Whole Foods was announced.]... Everyone looks to Amazon for leadership and I’ve been predicting they were going to go into stores for five years. I can’t even really legitimately say I’m right, because they don’t have a lot of stores yet. They haven’t found a model that works for them yet. I still believe they’re going to buy a Macy’s, or a Carrefour or something like that. I can’t imagine why they wouldn’t buy Whole Foods, for example, just because of the urban locations. They could close them down and just turn them into warehouses and I think they could justify the price.
The Radial Tire Lesson for Silicon Valley [H/T @trengriffin] (LINK)

How would Ann Miura-Ko have reacted if Bill Gates had walked into her office in 1975? - by Tren Griffin (LINK)

Vegetable oils, (Francis) Bacon, Bing Crosby, and the American Heart Association - by Gary Taubes (LINK)

Book of the day: Speculation As a Fine Art and Thoughts on Life -  by Dickson Watts [See also: Rules of a Successful Speculator]

Friday, June 16, 2017


John Huber's Thoughts on The Most Important Moat (LINK) [Some great thoughts from John, and it's a topic I've been thinking about a lot more lately, especially in regards to a few industries in particular, such as niche software companies and niche specialty chemical companies, among others. And the model of selling lower volume, higher margin products seems increasingly more at risk every day.]
In summary, I think it’s helpful to keep the following concept in mind: Value to the customer is one of the most important things to consider when analyzing companies. 
No longer can companies use a distribution advantage, a regulatory advantage, market share dominance, or some other barrier to entry that insulates them from competition. Those advantages can still be significant moats, but only if the end-customer is getting a good deal. If not, a competitor will spring up, gain scale in a shockingly quick manner, and figure out a way to meet the needs of that end-customer. Change happens more rapidly, customers have more choice (and more information), and barriers to entry are too low for big incumbents to rest on their laurels. 
Amazon buying Whole Foods Market (LINK)

Walmart to acquire Bonobos (LINK)

Amazon wants to become Walmart before Walmart can become Amazon (LINK)

Blockchain Technology Will Change Accounting [H/T Alex] (LINK)
Related book: The Business Blockchain
Exponent Podcast: Episode 118 — Podcasting and Centralization (LINK)

Actions, not words, reveal our real values - by Derek Sivers (LINK)

Which Animal Murders the Most? (video) (LINK)

What If (Almost) Every Gene Affects (Almost) Everything? - by Ed Yong (LINK)