Friday, February 28, 2020


"In the world of modern finance, a love of numbers has replaced a desire for critical thinking. As long as something has a number attached to it, then it is taken as gospel truth. Research shows that people are often fooled by the use of pseudoscience. Simply making things sound complex makes people believe them more! Risk managers, analysts and consultants are all guilty of using pseudoscience to promote an illusion of safety. We all need to be on our guard against the artificial deployment of meaningless numbers. Critical thinking and scepticism are the most unrated (and scarce) tools in our world." --James Montier ("Mind Matters," April 29, 2008)

How to respond to COVID-19 - by Bill Gates (LINK)

The Great Buenos Aires Bank Heist [H/T Linc] (LINK)

Gotta Go Fast: Why Gaming IP Is Finally Taking Off in Film/TV - by Matthew Ball (LINK)

Exponent Podcast: 182 — Scale Scale Scale (LINK)

The Disruptive Voice Podcast: 48. Disrupting Healthcare with Dr. Mahek Shah (LINK)

Grant’s Current Yield Podcast: The Empire Strikes Out (LINK)

Know Your Risk Radio (podcast): Raoul Pal (LINK)

The Coronavirus and How Political Spin Has Worsened Epidemics - by Evan Osnos (LINK)

Freeman Dyson, Visionary Technologist, Is Dead at 96 (LINK)
Related previous link (other links and books included): Freeman Dyson on Living Through Four Revolutions (2011 lecture)
"I don't particularly care [if the things I'm doing] are important or not. I'm not driven by a passion to dig out the deep secrets of nature. I'm much more interested just in exercising my skills as best I can and enjoying life." --Freeman Dyson

Thursday, February 27, 2020


Lucky Problems (LINK)

Controlling the Pendulum of Emotions - by Ian Cassel (LINK)

Charles Schwab on The David Rubenstein Show (video) (LINK)

Roblox Valued at $4 Billion as Investors Bet on Future of Gaming ($) (LINK)
Andreessen Horowitz leads investor group in latest $150 million funding round for popular videogame hub
Up to 91% More Expensive: How Delivery Apps Eat Up Your Budget (LINK)

Infinite Loops Podcast: Jim Chanos – Financial Frauds and Manias: Past, Present, Future (LINK)

The Tim Ferriss Show (podcast): #412: Josh Waitzkin on Beginner’s Mind, Self-Actualization, and Advice from Your Future Self (LINK)

Alfred North Whitehead’s Awe-Inspiring Focus (LINK)

Roger Lowenstein reviews the book Dark Towers [H/T @pcordway] (LINK)

The introduction to Peter Zeihan's latest book, Disunited Nations (LINK)

Matt Ridley: Officially Introducing My Latest Book, "How Innovation Works" (LINK)

Wednesday, February 26, 2020


"One of the most notable behavioral traits among investors is their tendency to overlook negatives or understate their significance for a while, and then eventually to capitulate and overreact to them on the downside.  I attribute a lot of this to psychological failings and the rest to the inability to appreciate the true significance of events. As negatives accumulate – whether they surface for the first time or just are finally recognized as significant – eventually a time comes when they can no longer be ignored, and instead they come to be treated as being of overwhelming importance." --Howard Marks ("On the Couch," January 2016)

Amazon Empire: The Rise and Reign of Jeff Bezos (video) (LINK)
FRONTLINE examines Amazon CEO Jeff Bezos’ ascent to power and the global impact of the empire he built. The film also investigates the darker side of the company’s rapid growth, and the challenge of trying to rein in the power of the richest man in the world.
Summary version of the Credit Suisse Global Investment Returns Yearbook 2020 (LINK)

Email Addresses and Razor Blades - by Ben Thompson (LINK)

Brent Beshore interviews Trish Higgins and Will Thorndike at Capital Camp 2019 (video) (LINK)

This is Not 1999 - by Eric Cinnamond (LINK)

Leithner Letter No. 245-248 (26 March – 26 June 2020) (LINK)

A Viral Market Meltdown: Fear or Fundamentals? - by Aswath Damodaran (LINK)

Invest Like the Best Podcast: Niko Canner – Become a Perfect Instrument (LINK)

Planet MicroCap Podcast: 109 - Boring is Beautiful with Brent Beshore, Founder and CEO of Permanent Equity (LINK)

Trailblazers with Walter Isaacson (podcast): Theme Parks: Where Tech Meets Thrills (LINK)

Hidden Forces Podcast: Market Nihilism: Price Discovery in a World Where Nothing Matters | Ben Hunt & Grant Williams (LINK)

Edge #566: Waiting for "The Final Plague" - A Talk with Nathan Wolfe [January 2009] (LINK)

You’re Likely to Get the Coronavirus - by James Hamblin (LINK)
Most cases are not life-threatening, which is also what makes the virus a historic challenge to contain.
Book of the day: Spillover: Animal Infections and the Next Human Pandemic - by David Quammen

"Those who have knowledge don't predict. Those who predict don't have knowledge." --Lao Tzu

Monday, February 24, 2020


Howard Marks on investor psychology during coronavirus fears (video) (LINK)

How to Write Usefully - by Paul Graham (LINK)

100 Little Ideas - by Morgan Housel (LINK)

Finite and Infinite Games: Two Ways to Play the Game of Life (LINK)

What the E*Trade Deal Tells You About the New Investing Game - by Jason Zweig ($) (LINK)

13 Metrics for Marketplace Companies (LINK)

The Future Will Be Genetically Engineered (LINK)

Exponent Podcast: 181 — Competing with Spotify and Regulating Acquisitions (LINK)
Related article: "The Daily Update Podcast"
Venture Stories Podcast: Scaling and Network Effects with Anu Hariharan (LINK)

Highlights from Matt Ridley's reddit AMA (LINK)

Why have so many of our recent viruses come from bats? - by Matt Ridley (LINK)

The Strange Influence the Sun Has on Whales - by Ed Yong (LINK)

CNBC's full interview with Berkshire Hathaway CEO Warren Buffett

Link to video

Sunday, February 23, 2020

Clayton Christensen quote

From the article "How Will You Measure Your Life?":

“If you study the root causes of business disasters, over and over you’ll find this predisposition toward endeavors that offer immediate gratification. If you look at personal lives through that lens, you’ll see the same stunning and sobering pattern: people allocating fewer and fewer resources to the things they would have once said mattered most.” --Clayton Christensen 


Friday, February 21, 2020

Semper Augustus Investments Group: 2019 Annual Letter

Once again, Chris Bloomstran's year-end letter is a must-read. Like last year, this is great to read in tandem with Warren Buffett's annual letter, which will be released in the morning.


And if you want to review all of Chris' deep dives into Berkshire, I recommend his 2015 letter, followed by his 2016 interview with Kate Welling, then the 2016 letter, 2017 letter, 2018 letter, and 2019 letter.

Thursday, February 20, 2020


Note to the hardcore Berkshire and investing readers: Warren Buffett's letter to shareholders will be released on Saturday and, as we've done for the past few years, Chris Bloomstran's annual letter will also be released here on the blog tomorrow. Chris was hoping to keep things much shorter than the 112-pager from last year, but it's looking like it'll come in a bit longer than that for this year. So make sure your printer is full of paper and ink, and check back here during the second half of the day tomorrow for the Semper Augustus Investments Group 2019 Annual Letter. 


"Conservatism may cause investors to refrain from making some investments that in hindsight would have been successful, but it will also prevent some sizable losses that would ensue from adopting less conservative business valuations." --Seth Klarman

The Best Thing You Can Do for Your Work Is Take a Walk - by Ryan Holiday (LINK)

The Knowledge Project Podcast: #76 Frank Stephenson: Pushing the Limits of Innovation (LINK)

Superinvestors and the Art of Worldly Wisdom Podcast: #32: Christopher Cole On Appreciating Risk (LINK)

Walter Isaacson reviews the book Franklin & Washington: The Founding Partnership by Edward J. Larson (LINK)

How often do severe solar storms pummel the Earth? - by Phil Plait (LINK)

A Huge Discovery in the World of Viruses - by Ed Yong (LINK)

What's Next for COVID-19? [H/T @Atul_Gawande] (LINK)
Containment of the coronavirus would make an enormous difference to health around the world. Is it still possible?

Tuesday, February 18, 2020


"The cost of every deal we do is measured by the second best deal that’s around at a given time, including doing more of some of the things we’re already in." --Warren Buffett (2001)

"Charlie and I always figure that our cost of capital is what could be produced by our second best idea. And then our best idea has to exceed that." --Warren Buffett (2014)

Twenty Years of Owning Berkshire Hathaway (LINK)

Broyhill 2019 Annual Letter (LINK)

Risk and loss aversion in ergodicity economics (LINK)

The a16z Marketplace 100 (LINK)

The Cutting Room Files, Part 7: Europe - by Peter Zeihan (LINK)

Bob Iger on The Bill Simmons Podcast (LINK)

Ben Thompson on The Bill Simmons Podcast (LINK)

The Acquirers Podcast: Dylan Grice (LINK)

Macro Voices Podcast: #206 Chris Cole: Optimizing portfolio construction for changing times [22:02 mark] (LINK)

Capital Allocators Podcast: Dan Rasmussen (LINK)

Acquired Podcast: Sequoia Capital Part II (with Doug Leone) (LINK)

Sir William Osler’s Advice to Students: Practice Concentrating on Hard Things (LINK)

The Cascading Consequences of the Worst Disease Ever - by Ed Yong (LINK)

Friday, February 14, 2020

No master plan...

From Warren Buffett at the 1997 Berkshire Hathaway Annual Meeting
30 years ago we didn’t know we would be in the insurance business.  
We have no master plan. Charlie and I did not sit down in 1960 — early ’65 — and say, “We’re going to do this and that,” and all that.  
We’re going to try and do sensible things as we go along. The more money we have, the harder it is to find sensible things. But that’s the criterion.
Insurance is certainly a major area of opportunity for us. It’s been a major opportunity.  
In certain fields we have a terrific advantage for the three reasons I laid out in the annual report. We have capital strength, and a willingness to take on risk, and a speed of action, and a certainty of payment, that in aggregate no one matches.  
Now, how much demand there is for that depends on circumstances in the business and how much supply there is at lower prices that we think don’t make sense is another question. But I think we’ll do OK in insurance over time. 
From Warren Buffett at the 2001 Berkshire Hathaway Annual Meeting
We don’t have a master plan. Charlie and I do not sit around and strategize or talk about the future of various industries or do anything of that sort. It just doesn’t happen. We don’t have any reports. We don’t have any staff. We don’t have any of that.  
We try to survey the whole financial field. We try to look at what comes in and look for things we understand, where we think they have a durable, competitive advantage, where we like the management, and where the price is sensible.  
We had no idea two or three years ago, that we would be the 87 percent owner of the largest broadloom carpet company in the world. 
We don’t plan these things. But I would tell you in a general way that 20 or so years from now, we will own a lot more businesses. 
...So we have no more master plan now than we had back in 1965 when we bought the textile mill, really. I mean, we had a lousy business. I didn’t realize it was as lousy as it was when I got into it. And we just had to start trying to deploy capital in an intelligent way.... That’s our business and we enjoy it.
From Charlie Munger in 2013
Therein lies a lesson in life. I think most lives work best when you simply react intelligently to the opportunities and difficulties you encounter, and just take the results as they fall.  
Some people think that by master planning, you will solve everything, but what I find is that the master plan gets a life of its own, and people believe it because they previously decided on that then, and they make all kinds of mistakes.  
(Thomas) Carlyle was a very smart man, and one of his favorite sayings was, the task of man is not to see what lies dimly in the distance but to do what lies clearly at hand. [Ed: actual quote: “Our main business is not to see what lies dimly at a distance, but to do what clearly lies at hand.”]

Thursday, February 13, 2020


"Another thing to avoid is extremely intense ideology because it cabbages up one's mind. You see a lot of it in the worst of the TV preachers. They have different, intense, inconsistent ideas about technical theology, and a lot of them have minds reduced to cabbage. And that can happen with political ideology. And if you're young, it's particularly easy to drift into intense and foolish political ideology and never get out. When you announce that you're a loyal member of some cult-like group and you start shouting out the orthodox ideology, what you're doing is pounding it in, pounding it in, pounding it in. You're ruining your mind, sometimes with startling speed. So you want to be very careful with intense ideology. It presents a big danger for the only mind you're ever going to have." --Charlie Munger (Poor Charlie's Almanack, Talk Ten: USC Gould School of Law Commencement Address)

First, Do No Harm - by Ben Thompson (LINK) [Thompson was also on a panel for a Public Workshop on Venture Capital and Antitrust: VIDEO.]

Hidden Forces Podcast: The Decline of Active Management, the Rise of Market Nihilism, & the Fall of the Roman Republic | Mike Green (LINK)

Conversations with Tyler (podcast): Tim Harford on Persuasion and Popular Economics (LINK)

Ryan Holiday interviews Tim Ferriss (podcast) (LINK)

Ezra Klein with Malcolm Gladwell: Why We’re Polarized (video) (LINK)

China’s “Iron House”: Struggling Over Silence in the Coronavirus Epidemic - by Evan Osnos (LINK)

Tuesday, February 11, 2020


For those that are going to the Fairfax Financial Annual Meeting in April and are looking to attend other events around the meeting, discount rates for the YYX Toronto Value Symposium are available


What “Bullet-Proof Investing” Means to Me? - by Sanjay Bakshi (LINK)

Crisis Investing: How to Maximize Returns During Market Panics (LINK)

Winter 2020 issue of Graham & Doddsville (LINK)

The Flaws of "Subscription Fatigue", "SVOD Fatigue", and the "Streaming Wars" - by Matthew Ball (LINK)

Writing in a Business Context - by Jerry Neumann (LINK)

Some great notes from the book Capital Account: A Fund Manager Reports on a Turbulent Decade, 1993-2002 (LINK)
Related previous posts: 1) THE TENETS OF CAPITAL CYCLE ANALYSIS; 2) Ed Chancellor on the capital cycle...; 3) More from Ed Chancellor on focusing on industry supply...
Can We Have Prosperity Without Growth? (LINK)

Chemical Toxicity and the Baby Bust: Unexpected threats to human fertility and, hence, chemical companies - by Jeremy Grantham (LINK)

Naked Mole Rats Seem More Alien Than Mammal. What Explains Their Weirdness? (LINK)

Monday, February 10, 2020


Famed investor Charlie Munger shares insights into the ‘basic math of life’ at Redlands Forum [H/T @robertmackenzie)] (LINK) [Hopefully a video of this conversation, as well as the Daily Journal Annual Meeting occurring later this week, will become publicly available.]

The Gates Foundation's 2020 Annual Letter from Bill and Melinda Gates (LINK)

The Coming Retirement Crisis Part II - by Raoul Pal (video) (LINK)

Why We're in the Biggest Financial Bubble in History (w/ Steve Bregman & Mike Green) (video) (LINK)

Odd Lots Podcast: Why The Rise of Passive Investing Might Be Distorting The Market (w/ Mike Green) (LINK)

Hidden Forces Podcast: The Hundred Year Portfolio: How to Grow & Protect Generational Wealth | Christopher Cole (LINK)
Related paper: "The Allegory of the Hawk and the Serpent"
EconTalk Podcast: Marty Makary on the Price We Pay (LINK)
Related book: The Price We Pay: What Broke American Health Care--and How to Fix It
The Ezra Klein Show (podcast): Tim Urban on humanity’s wild future (LINK)
Related link: "The Story of Us"
In Praise of Irrationality (LINK)
Related book: Alchemy
Mental Models in Space (LINK)
Related book: An Astronaut's Guide to Life on Earth
Yuval Noah Harari Gives the Really Big Picture (LINK)
Related book: Sapiens

Friday, February 7, 2020


"The basic reason for the cyclicality in our world is the involvement of humans. Mechanical things can go in a straight line. Time moves ahead continuously. So can a machine when it’s adequately powered. But processes in fields like history and economics involve people, and when people are involved, the results are variable and cyclical." --Howard Marks ("The Most Important Thing")

Bond Funds Are Hotter Than Tesla - by Jason Zweig ($) (LINK)

Dan Rasmussen - Five Investing Heresies (video, from last year) (LINK)

The Next Frontier in Storytelling Universes and the Never Ending Desire for More - by Matthew Ball (LINK)

The concentration of economic power has led to spectacular investment returns (LINK)

Technocracy: Will What We Love Ruin Us? - by Frank K. Martin (LINK)

History is Only Interesting Because Nothing is Inevitable - by Morgan Housel (LINK)

Grant’s Current Yield Podcast: Impossible is extinct (LINK)

The Disruptive Voice Podcast: Micromobility and The Future of Transportation: A Conversation with Horace Dediu (LINK)

"Shall I tell you now, in a word, the sum of human duty? Patience, where we are to suffer; and prudence in things we do." --Seneca

Thursday, February 6, 2020


"I think most people get very few, what I call, no-brainer opportunities, where it’s just so damned obvious that this is going to work. And since they are very few and they may be separated by periods of years, I think people have to learn to have the courage and the intelligence to step up in a major way when those rare opportunities come by." --Charlie Munger (1997)

"Yeah. You've got to be willing to take a really big bite. And it’s crazy if you don’t. And it’s crazy if you dabble around at the edges, so you’re not prepared to take a big bite when the time comes." --Warren Buffett (1997)

Why it only costs $10k to ‘own’ a Chick-fil-A franchise [H/T @cristinagberta] (LINK)
The chicken chain is known for having the lowest entry cost of any major fast-food franchise — but there’s a catch.
Vanguard Broadens Reach With Entry Into Private Equity ($) (LINK)

Ray Dalio's response to the recent WSJ article on him and Bridgewater (LINK)

Corner Office from Marketplace (podcast): Janet Yellen and David Malpass on global economic slowdown (LINK)

1,000 True Fans? Try 100 (LINK)

Monday, February 3, 2020


"Certainly opportunity cost has been much more in the forefront of mind in the last 18 months. When things are moving very fast, when both prices are moving, and in certain cases, intrinsic business value is moving at a pace that’s far greater than we’ve seen for a long time, it means that in terms of calibrating A versus B, versus C, it’s tougher. It’s more interesting. It’s more challenging. And it can be way more profitable, too. But it’s a different task then when everything was moving at a more leisurely pace." --Warren Buffett (2009)

The Illusory Truth Effect: Why We Believe Fake News, Conspiracy Theories and Propaganda (LINK)

Facebook’s Platform Opportunity - by Ben Thompson (LINK)

AQR Says to Get Sober About Future Returns (LINK)

How Private Equity Buried Payless (LINK)

The Long Buy - by Fred Wilson (LINK)

Is CPG Doomed? (LINK)

The Absolute Return Letter, February 2020: Five Lessons from History (LINK)

Mutual Fund Observer, February 2020 (LINK)

Small Caps: Finding Great Companies (video/podcast, from about 3 years ago) (LINK)

The Acquirers Podcast: Private Value: Jonathan Boyar (LINK)

EconTalk (podcast): Robert Shiller on Narrative Economics (LINK)
Related book: Narrative Economics
The Peter Attia Drive (podcast): #91 – Eric Topol, M.D.: Can AI empower physicians and revolutionize patient care? (LINK)

11 Reasons Not to Become Famous (or “A Few Lessons Learned Since 2007”) - by Tim Ferriss (LINK)

You Can Vote. But You Can’t Choose What Is True. - by Yuval Noah Harari ($) (LINK)

Qassem Suleimani and How Nations Decide to Kill - by Adam Entous and Evan Osnos (LINK)

The New Coronavirus Is a Truly Modern Epidemic - by Ed Yong (LINK)

Book of the day (recommended by Christopher Davis): Americana: A 400-Year History of American Capitalism

Sunday, February 2, 2020


"One can see the investment universe as full of certainties, or one can see it as replete with probabilities. Those who reflect and hesitate make far less in a bull market, but those who never question themselves get obliterated when the bear market comes. In investing, certainty can be a serious problem, because it causes one not to reassess flawed conclusions. Nobody can know all the facts. Instead, one must rely on shreds of evidence, kernels of truth, and what one suspects to be true but cannot prove." --Seth Klarman

Masters in Business Podcast: Christopher Davis Discusses Smart Value Investing (LINK)

The Stock Got Crushed. Then the ETFs Had to Sell. - by Jason Zweig ($) (LINK)

Ray Dalio Is Still Driving His $160 Billion Hedge-Fund Machine ($) (LINK)

Useful Laws of the Land - by Morgan Housel (LINK)

Tankers Are Tanking - by Harris Kupperman (LINK)

An anonymous, detailed short thesis on Luckin Coffee [H/T @muddywatersre] (LINK)

Exponent Podcast: 180 — It’s Been a Week (LINK)

The Young IPA Podcast Episode 143: We Just Had The Best Decade In Human History with Matt Ridley (video) (LINK)

Hardcore History Addendum Podcast: EP9 Glimpses of Olympias (LINK)

The Sun, up close and very personal - by Phil Plait (LINK)