Warren Buffett surprises teen cancer patient on CNBC

Link

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Some advice from Mr. Buffett:

Buffett's main piece of advice for Tre as he prepares to enroll in community college this fall: learn accounting so you can read financial statements. "Accounting is the language of business and there's nothing like getting it early and getting it into your system." 

Pointing out that accounting is a "language all of its own," Buffett said, "Getting comfortable in a foreign language takes a little experience, a little study, early on but it pays off big later on."

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And for a few accounting-related books (I need to add more, I know), go HERE.

Links

Bill Gross' latest Investment Outlook: Goodnight Vietnam​ (LINK)

Robert Shiller on CNBC (LINK)

John Hempton on CNBC (LINK)

Hempton also recently re-recommended the book Fatal Risk: A Cautionary Tale of AIG's Corporate Suicide

Losing my Amazon Religion (LINK)

Michael Covel interviews William Poundstone [H/T Derek] (audio) (LINK)

Related book: Fortune's Formula

Related previous post: Generalizing the Kelly Criterion

BBC: How much does an understanding of evolutionary biology influence policy-makers at the sharp end of government? (LINK)

Quantum Computing 101 (LINK)

Her Family Stopped Eating Sugar for A Year, and This is What Happened [H/T @farnamstreet] (LINK)

Related previous post: 60 Minutes: Is sugar toxic?

A deep-sea octopus is observed guarding the same clutch of eggs for nearly 4.5 years (LINK)

East Coast Asset Management Q2 2014 Investment Letter - Horse in Motion

Link to: Horse in Motion

In our second quarter letter you will find our portfolio update and general market observations. Each quarter we highlight one component of our investment process. This quarter, in the section titled Horse in Motion, I will discuss the value of an ownership mindset and how it plays an integral part in a compounding triumvirate with a good business and an effective operator. 

If it's not simple, then I'm not interested...

I was recently reminded of this story, as told by Peter Bevelin in one of my interviews with him (HERE):

As Munger says: “All I want to know is where I’m going to die so I’ll never go there.” When I hear them at the annual meeting, I am thinking about Einstein’s reply to a student. The student had challenged Einstein’s statement that the laws of physics should be simple by asking: “What if they aren’t simple?” Einstein replied, “Then I would not be interested in them.”  

They have a unique ability to distinguish masses of trivia from what is really important – to filter out situations, and find what’s at their core.

The “All I want to know is where I’m going to die so I’ll never go there” was also quoted in the book 100 to 1 in the stock market (see THIS post), and it also reminds me of Taleb's Fourth Quadrant.

Talks at Google: Mohnish Pabrai: "Dhandho. Heads I win; Tails I don't lose much"

Link to video

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Related book: The Dhandho Investor: The Low-Risk Value Method to High Returns

[H/T ValueWalk]

Ray Dalio & Larry Summers: An Examination of How the Economic Machine Works

Link to video

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Related previous post: How The Economic Machine Works In 30 Minutes - by Ray Dalio

[H/T ValueWalk]

Stan Druckenmiller's Full Delivering Alpha Presentation

Link to video

[H/T ValueWalk]

Peter Thiel quote

From Zero to One:

But while I have noticed many patterns, and I relate them here, this book offers no formula for success. The paradox of teaching entrepreneurship is that such a formula necessarily cannot exist; because every innovation is new and unique, no authority can prescribe in concrete terms how to be innovative. Indeed, the single most powerful pattern I have noticed is that successful people find value in unexpected places, and they do this by thinking about business from first principles instead of formulas. 

Charlie Munger and the Disliking/Hating Tendency

A short excerpt from Charlie's Munger's speech "The Psychology of Human Misjudgment" in Poor Charlie's Almanack that seems relevant given what's going on with Israel and Palestine today:

Disliking/Hating Tendency also acts as a conditioning device that makes the disliker/hater tend to: (1) ignore virtues in the object of dislike, (2) dislike people, products, and actions merely associated with the object of his dislike, and (3) distort other facts to facilitate hatred. 

Distortion of that kind is often so extreme that miscognition is shockingly large. When the World Trade Center was destroyed, many Pakistanis immediately concluded that the Hindus did it, while many Muslims concluded that the Jews did it. Such factual distortions often make mediation between opponents locked in hatred either difficult or impossible. Mediations between Israelis and Palestinians are difficult because facts in one side's history overlap very little with facts from the other side's.

Links

John Burbank on the Source of the Biggest Mispricings (LINK)

How Money and Banking Work On a Gold Standard (LINK)

Andrew Smithers: The problem of the equity risk premium (LINK)

Jim Grant: Buy Hated These Hated Stocks (LINK)

Mark Hanson: Lack of Defaults/Foreclosures/Short Sales; A Serious Housing & Spending Headwind (LINK)

Ebola Requires a Team Africa (LINK)

Stratfor: Gaming Israel and Palestine (LINK)

Unlearning From Peter Bernstein (LINK)

Q [Jason Zweig]. Over the course of your career, what are the most important things you’d say you had to unlearn? 

A [Peter Bernstein]. That I knew what the future held, I guess. That you can figure this thing out. I mean, I’ve become increasingly humble about it over time and comfortable with that. You have to understand that being wrong is part of the process. And I try to shut up at cocktail parties. You have to keep learning that you don’t know, because you find models that work, ways to make money, and then they blow sky-high. There’s always somebody around who looks smart. I’ve learned that the ones who are the most smart aren’t going to make it. I don’t know anybody who left investing to become an engineer, but I know a lot of engineers who left engineering to become investors. It’s just so infinitely challenging.