giofranchi

Yeah! Definitely! So… let’s just say shorting isn’t my style either! ;) Btw, quotes imo are “condensed and clear lessons”… there is nothing wrong with quoting… it is just the validity of the message that must be assessed each time. Or let's put it this way: there is nothing wrong with quoting... the only problem is when stupid things get quoted! ;D ;D Gio

Yeah! Very well said! I agree 100%. Gio

Ah! Sorry!… I just meant that, given the low esteem Mr. Biglari enjoys here, probably most board members don’t care much about a reading suggestion of his! Gio

$10,000 turned into $8 million after 55 years equate to a CAGR of 13%. Great! ;) Having started almost at the top of the 1920s bull market, and having invested through the whole Great Depression… make such a track record truly an outlier! If we also think that track record ends in 1983… practically at the beginning of the most spectacular stock bull market in history… I guess we all should look at Mr. Carret’s achievements almost in disbelief… Gio

I have kept my two baskets of shorts, though I have not added to them. Instead, I am gradually increasing cash. Gio

"Poverty Matters for Capitalists" by Mr. Charles Gave Gio

Well, I guess you might ask: who should really be supposed to care??!!… Anyway, this book was recommended also by Mr. Biglari during the last AM of BH. ;) I haven’t read it yet, but it definitely is at the top of my reading list. Gio

No, sorry! I have not. But I have read “The Art of Speculation” is a collection of financial articles he wrote. Instead “A Money Mind At 90” is an autobiography. Gio

I am reading [amazonsearch]A Money Mind At Ninety[/amazonsearch] --Wikipedia 1) "the best long term investment record of anyone I know" said by Warren Buffett 2) He lived to be 102 3) The marriage with his wife lasted for 63 years (until she passed away) I guess we all could learn a thing or two reading the story of his life! ;) Cheers, Gio

Don’t get misled… That formula is nothing but a discounted valuation… Mr. Penman’s simple, yet imo interesting idea is to apply a discounted valuation to equity, instead of cash flow… That’s it! A discounted valuation to understand how valuable a business actually is, that: 1) creates value, in other words that grows at a higher rate than its cost of capital; 2) should be valued on balance sheet metrics (some multiple of its BV or NAV). Which multiple of BV or NAV best approximates FV? Mr. Penman’s formula provides the clearest answer that I know of! ;) Gio

I agree: if what you are interested in are basically profitable net-nets, the book won’t add much value… the only question you must answer is why a business that’s profitable is selling for less then the value of its net current assets… unfortunately, I think the answer to that question each time is a different one, and each net-net is a case of its own… therefore, I guess no book will be of much help! Now that you made me think about it, I have realized that, although Mr. Penman warns against the perils of relying too much on future growth, probably the greatest usefulness of the book lies in the following: to provide an understanding of how much valuable truly is a business that will grow. ;) Gio

writser, on the contrary I think Mr. Penman’s book is exactly right for the kind of investments you and Nate look for! Mr. Penman warns very clearly about the danger of assuming growth too far into the future, and shows how to use his formula for calculating the present value of equity disregarding future growth. Therefore, that’s exactly right for the kind of investments that suits you the best. Of course, I never look for those investments. Instead, I want something that will grow. That’s why I had to “adapt” Mr. Penman’s formula to my way of investing. But basically I think it would be much easier for you to use Mr. Penman’s formula than it is for me! ;) This being said, I agree the book is not a manual on how to read financial statements, or how to detect aggressive accounting… Gio

I agree. Very good book! :) Gio

+1!!! ;D ;D Happy birthday, Sanjeev! :) Cheers, Gio

"The Emerging German-Russian Axis" by Mr. Charles Gave Gio Daily+6.30.14.pdf

Two key takeaways from the latest piece by Mr. David Hay: 1) Bridgewater thinks expected real returns for stocks have almost never been lower than today 2) Bridgewater thinks expected real returns for stocks and bonds have never been lower than today A curiosity (I would say an appalling curiosity!): Yields on 10-years government bonds in Spain have never been this low since… 1789!!! ::) Gio EVA+6.27.2014_NA.pdf

A really shameful World Cup for Italy… And the second in a row!!… Very bad! :( But I am a tennis player, and I am enjoying Wimbledon right now: I think Nole Djokovic is the best tennis player out there, and the way he plays is simply amazing… though I must admit Rafa Nadal is a wonder athlete, and to defeat him in a 3 out of 5 sets match is almost an impossible task! ;) Cheers, Gio

I am a material science engineer turned civil engineer. And I started my first company, civil engineering consulting services, 10 years ago. I didn’t start investing because of the love for math, analysis, problem solving, etc. … well, maybe the love for money … ;D ;D The reason I started investing is much more straightforward imo: I knew my engineering firm would never benefit from scale… it is not an easily scalable business… and therefore almost doesn’t need new investments each year. So, the reason I started investing is to answer the following question: what am I supposed to do with the fcf my firm puts in my hands? ;) Gio

+1! ;) Gio

This is very interesting: though I don’t keep a physical watchlist, probably I have one in my head! ;) Cheers, Gio

I always read letters to shareholders and conference call transcripts: that’s where you can find the most qualitative information about a business: both its model, if it is predictable enough or otherwise, and its management, if they are and behave as owners. If I like what I see from a qualitatively point of view, I start looking at numbers: usually I look at the three financial statements, the Income Statement, the Balance Sheet, and the Cash Flow Statement. If then everything is clear to me also from a quantitative point of view, I invest… always leaving some room to average down. If, on the contrary, I have some doubts about the numbers, I scan the Notes to the three financial statements, searching for some answers. How long it takes me to find those answers obviously depends and might vary a lot. Usually, I am the most comfortable when I find a company that has passed all my qualitative requisites, and also presents financial statements that speak for themselves. :) Gio

Parsad is absolutely right, and in this case, WEB is also in the wrong ... consider he admitted during the KO compensation debacle that in his many years on 17 Boards he never ONCE saw a compensation plan NOT approved ... I felt sick when I heard this ... makes me admire Richard Kinder all the more Yeah! Maybe… But you must be realistic and pragmatic: Is BH a wonderful platform for doing business? Yes, it is. Would I like to pay Mr. Biglari somewhat less? Yes, I would. Would I quit a wonderful platform for doing business, because I think Mr. Biglari is paid too much? No, I wouldn’t. Perhaps, I have simply misunderstood Sanjeev’s point… ;) Gio

Packer, Those are not incentives… those are threats… And they have never worked. Even if they were incentives, do you really see a whole continent that starts behaving like the German people?! I don’t think it works that way… You have a fiscal union in the US, because it doesn't work that way... But I hope I am totally wrong!! ;) Gio

Ok… then a political and a fiscal union will be the final outcome… that would be very fine! And I really hope we manage somehow to get there, and soon! But… do you really see a French ruled by a German President? Or… do you really see German money leaving for the south? How do you make 1 nation out of a geographic area in which 20 different languages are spoken? How do you make 1 nation out of a geographic area which has just sent 10 teams to the World Cup in Brazil?! ;D ;D Gio

I agree. Try also "Extraordinary Popular Delusions and the Madness of Crowds" by Charles Mackay. Gio