Tuesday, March 5, 2019


"Anytime you have incentives, with people who are quite smart, to mismark things, you’re going to get mismarks, or temptations to take on risk in an inappropriate manner. Originally with derivatives, the argument was made that it would disperse risk. That, you know, the Coca-Cola Company faced foreign exchange risk, or some bank faced, you know, interest rate risk. And the theory was that you would use these derivatives to spread risk around the system. And indeed, there are many people that make that argument now. I would say that that may work in that manner a great percentage of the time. But the time that counts is when the system has intensified risk and placed enormous credit risk on very, very few institutions. Believe me, the Coca-Cola Company is in a better position to accept foreign exchange or interest rate risk in a year than some derivatives dealer who has tons of positions on. And I think, actually, there is much more risk in the system because of derivatives than the proponents of derivatives would say has been dispersed because of the activities. " --Warren Buffett (2004)

The Knowledge Project Podcast: Luck, Risk and Avoiding Losers (with Howard Marks) (LINK)
Related book: Mastering the Market Cycle: Getting the Odds on Your Side
Kyle Bass talks China, markets, and the Fed (video) (LINK) [Bass also just did another longer interview on Real Vision.]

Greece Looks to Borrow Amid Buoyant Markets ($) (LINK)

Invest Like the Best Podcast: Peter Zeihan – The Future of Geopolitics (LINK)
Related books: 1) The Accidental Superpower; 2) The Absent Superpower
WorkLife with Adam Grant (podcast): The Creative Power of Misfits (LINK)

Edge #531: Lightning talks by thirteen "Possible Minders" at the Brattle Theatre (LINK)