I'm kinda tired of hearing stuff about the "who is the next Buffett" questions. People have come and gone on being the next Buffett. Heck even Chamath was considered the next Buffett....but was he, really? There is only 1 Buffett. And what makes him special is his ability to avoid catastrophic risk and his ability to master his emotions. Truly one of a kind.
Great episode. I’ve been wondering what happens if Buffett were to pass away soon. Wouldn’t the S&P increase the Free Float factor of Berkshire by 20%, and then all tracking indices will need to buy.
There's a limited set of options for what Berkshire can purchase because they're too big. On the other hand, Wesco has the same management as Berkshire and it's smaller so the plays not available to Berkshire because they're too big are available to Wesco.
nooooooooooo, I missed the : Being from Torino: we're famous for : FIAT, CHOCOLATE (we've invented NUTELLA(it comes from our region): REd wine(barolo, barbaresco), the BIGGEST Egyptian museam outside of Cairo, we have the MOLE (our eiffiel tower, it used to be a synagogue) and the list goes on and on BUT TYPICAL ENGINEER (we have one of the best eNGINEERING schools in the world)... sais 'bagnacuada' which is typicall... but damm...typical, typi9cal Torino engineer.. and also typical Torino Engineer: extremely insighful with real examples, Real pratical. It was a joy listening to the pdocast as usual
The strategy described at 44:24 is what Roald Amundsen did for his South Pole expedition. His model for people who succeeded in surviving extreme cold environments were the Native people of Greenland, Alaska and Canada. He also studied the journals of all failed Polar expeditions in order to understand what mistakes they did. He took what he felt were the best features of the best dog sleigh designs, learned how to make igloos. In the South Pole he made caches of seal meat in preparation for the return trip and ate the meat raw in order to get vitamin C and avoid scurvy. His journals are a stark contrast with those of Scott who did not go through this exercise and depended on donkeys who quickly died. Had he not used sleigh dogs, another good possible choice could have been Caribou or Reindeer with sleights such as the Lapon people use in Finland he would have needed though to stock his food caches with seaweed or hay which might have been more problematic to obtain.
The idea of the loss of the 500 dollars means losing any future gains that could have been obtained by that 500 dollars is somewhat like how people who in the early 20th century believed in Eugenics lost not only the children of the person they forcibly sterilized but any benefit that any of their descendants could have produced in the now deleted timelines. Einstein's intelligence was poorly evaluated by his contemporary teachers when he was young. Similarly the believers in Eugenics may have lacked the needed skills to recognize an intelligence far greater than theirs the end result being something like the 2006 film Idiocrasy. This brings up the Jeff Bezos point of view that decisions that can be reversed quickly should be taken quickly. Decisions who cannot be reversed should be given far more careful thought.
The ski story is like the story of people running away from the bear. They don't have to outrun the bear, only outrun the slowest person running away from the bear.
at 45:01 Tobias asked Dellanna what strategy is best to use when trying something new, I prefer adding Charlie Munger's Inversion idea - ask yourself "How can I really F this up royally to guarantee a fail.. then make sure you avoid those things" Gets you to the same ideas, but uses Charlie's mental shortcut. Short, sweet, indelible.
Charlie Munger also said: "You only need to get rich once" meaning that it makes on sense to risk money that you need to obtain money that you don't need. People who obtained wealth recklessly are less likely to become careful stewards of it. For a similar reason, Jesse Livermore put a portion of his wealth in a trust fund that he couldn't touch to make sure his family would be taken care of because he knew of his propensity to take risks that would blow him up.
Disagree with the guest on position sizing. It depends on conviction which really depends on how long you’ve been following a business and how deep you understand it. I would argue it’s impossible for me to understand all the economies of 20 companies as an individual investor. My tiny brain can only follow 5-6.
Lots of investors talk about 'high conviction positions' and the like. The uncomfortable truth is, even if you know the business inside out you still can't account for all the random exogenous risks that could materialise and scupper the investment. If that were not the case, investment and valuation would be a hard science, rather than the craft we all know it to be. That's also why the Kelly criterion is close to useless in the context of investing. To slightly tweak a Mark Twain quote, it's not only the things you don't know that'll kill you, but also the things you don't know but think you know.
Conviction is a synonym for System One thinking, intuition, gut feeling and they can lead someone astray. When using a system like the Greenblatt's Magic Formula, technically the one that scored the best would be the "highest conviction" purchase but there's no guarantee that the one in the number 2 or number 3 position won't do better. Which is why he suggested taking equal positions in the top 10. Sometimes there's a good salesman that's good at making you feel greed towards one particular pick this conviction doesn't necessarily mean it will do better.
There’s an argument to cut the dividend and just buy shares. I don’t think some shareholders would enjoy that given they probably count for asset liability mismatches. Yes, can always sell shares to generate the cash. So maybe I’m wrong.
Nothing like getting the band back together. Bill if you're interested in plays on natural gas l'd check out $EPSN. Small cap, have a lot of insider buying by C-suite, no debt; full disclosure I've been averaging in myself but worth taking a look.
I don’t see the difference between what roaring kitty is doing and a guy going on Bloomberg and talking his book. Anyone who says it’s different is passively admitting that MSN business Bloomberg, etc. don’t matter because no one watches them.
