Links

"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)

Links

How to Build Your Own BRK [via @Sanjay__Bakshi] (LINK)

The Popular Delusions newsletter relaunches (Dylan Grice) (LINK) [To subscribe, go HERE.]

Secrets of the Greatest Hedge Fund of All Time (video) (LINK)

Related book: The Man Who Solved the Market: How Jim Simons Launched the Quant Revolution

Boyar Value Group's Q3 Letter (LINK)

Tech and Liberty - by Ben Thompson (LINK)

De Beers Cuts Diamond Prices by About 5% as Industry Crisis Deepens (LINK)

Invest Like the Best Podcast: George Rzepecki – Investing in Africa (LINK)

EconTalk Podcast: Venkatesh Rao on Waldenponding (LINK)

Big Questions with Cal Fussman Podcast: Charles Schwab: How To Own Your Tomorrow (LINK)

Making Sense with Sam Harris Podcast: #174 — Richard Dawkins (LINK)

The James Altucher Show (podcast): 503 - The Path to Stillness: Ryan Holiday on How to Develop Self-Discipline & Reduce Overwhelm (LINK)

Related book: Stillness Is the Key

Albert Edwards and Dylan Grice: Bearish Forecasts from Two Top Strategists

Found via ValueWalk.

It’s been nearly 18 years since Albert Edwards forecast an “ice age” in which bonds would outperform equities. He’s been right until just recently, when cumulative returns on the two classes converged. But Edwards insists that his thesis is still accurate – deflation will be the force to propel bonds over stocks, he says. Dylan Grice, meanwhile, warns that the markets operate on an unstable equilibrium that could devolve into apocalyptic conditions.

The two spoke at Societe Generale’s annual research conference in London on Jan. 14. Edwards is the firm’s global strategist. Grice is the director of research at Edelweiss Holdings, a Zurich-based investment manager. Prior to that, Grice worked alongside Edwards at Societe Generale.

“We are one recession, one slip away from outright deflation, both in the euro zone and in the U.S.,” Edwards said. That would adversely affect equities, he said.

If that message wasn’t sufficiently foreboding, Grice warned of a societal breakdown that would be far more disruptive.

The financial markets measure trust through yield, according to Grice. Investors should not be lulled into assuming today’s record-low yields (in both equities and bonds) imply similarly low degrees of risk. That is incongruous with current political developments, he said.

“It is wrong. It is the last hurrah,” Grice said. “This is not just an economic but a social phenomenon.”

The Language of Inflation – By Dylan Grice

Regular readers of our irregular publication will be aware of our thoughts on inflation, but for those who are not we would summarize them thus: inflation is not measurable. We can summarize our views on money with similar succinctness: it is poorly understood. And as for the economy, we know only this: it is a complex system. From these observations can be derived a straightforward corollary on economic policy makers: trying to control a variable you can’t measure (inflation) with a tool you don’t fully understand (money) in a complex system with hidden, unobservable and non-linear interrelationships (the economy) is a guaranteed way to ensure that most things which happen weren’t supposed to happen.

On the intrinsic value of gold, and how not to be a turkey - by Dylan Grice

Link to:  On the intrinsic value of gold, and how not to be a turkey

Dylan Grice: Would the real Peter and Paul please stand up?

A big thanks to Barry for passing this along! You can sign up to receive Grice’s future letters HERE.

Link to: Would the real Peter and Paul please stand up?