Tuesday, June 23, 2015

East Coast Asset Management's Q1 2015 Investment Letter - Mr. Market Revisited

Thinking backward is quite intuitive.   Backward thinking involves  looking  for patterns, making links  between  unconnected  events  and forming  theories to influence forward-looking decision-making.  Backward thinking has a gravitational pull toward the experiential emotion in our past as well as giving more proportion to recent events.  
In  my  opinion,  the  biggest  error  in  looking  backward is  not  going back far enough to solve to laws and principles that are invariable, or unchanging through time.  The three largest data sets, which I have previously written and credited Peter Kaufman for first enlightening me about, are: 
1. The inorganic systems around us, which are 13.7 billion years in age and contain all the laws of physics and mathematics,
2. Organic systems, or all the biology on earth, which are 3.5 billion years in age and,
3. 20,000 years of recorded human history. 
We can use these invariable laws and principles for intelligent decision-making.