rukawa

I used to meditate regularly and i am trying to get back into it. You can learn meditation in about 5 minutes...you don't need classes or even books and most instructions are way too long and prescriptive. Its extremely simple. The main advantage was that you get a kind of mental flexibility. You gain the ability to notice yourself entering into a certain mental pattern and then you can choose to break out of that pattern. At some point it becomes almost effortless. As far as mood goes...meditation helps. But physical exercise is hugely more powerful.

I think one of the huge difficulties with cartels is that its difficult to actually monitor how much cartel members are selling. Each member of the cartel agrees to certain limits. But its difficult to know whether they are making sales on the side that you don't know about. A real organized cartel would need enforcement mechanisms like fines and permanent inspectors in each country. De Beers has an even better model which is that they forced all producers to go through the De Beer's distribution channel. This effectively allowed De Beer's to control how many diamonds got sold and to whom. This is a highly efficient sensible way to implement a cartel but it only worked for diamonds because De Beers had ways of disciplining producers who tried to operate outside their system by flooding the market with similar types of diamonds.

To me weddings are torture. Paying $10000 for a wedding is like paying $10000 to get kicked in the ass repeatedly. They are a headache to organize. Incredibly stressful to plan. And usually the actual day is itself stressful and requires you to go up to a bunch of people you barely know and pretend to be happy they came. And then there are all the things that inevitably go wrong and piss you off. And I don't get why it costs money to spend time with friends. Go to Boston Pizza. It doesn't cost $10000. And I also don't understand how the value of a wife is equated to spending money on her. To me it makes sense to spend money on things. And to trade off money for time that you spend with people. A woman who you spend no time with but spend money on is called a prostitute. As far as I can see adulthood consists of doing really stupid things repeatedly that make absolutely no sense but you have to do them because if you don't everyone else will judge you as pathetic. Its all about the optics.

You just like it because the government can't shut it down. Lol. You should recognize that in areas like this your cognitive bias is huge.

I buy most of Druckenmiller argument except the conclusion because of course there is no real connection between the conclusion and the arguments. His basic argument is that equities are overvalued. His conclusion is buy gold. Why not hold cash? He never really says. I feel like I should use this logic with girls. Make some argument or bunch of claims she agrees with. Then at the end conclude with "and therefore you should go on a date with me" http://www.businessinsider.com/the-scientifically-proven-method-for-getting-people-to-say-yes-2011-7

I think the opposite. The US is the least distorted housing market. Although I still regard the US market as hugely distorted. To me, 30 year mortgages are a ridiculous concept. And 3% mortgage rates even more ridiculous. How many other consumption or even investment markets are there which involve so much OPM and with such generous terms. I define a non-distorted housing market as the one that existed before the Great Depression where mortgage financing was minimal. To you I guess its the exact opposite...a non-distorted housing market is one that involves maximum mortgage financing.

I know I don't have an informational edge. And I think the shittiest industry analyst has a far better ability to analyze his industry than I do. But I am not sure that either informational or analysis advantages are the key. I actually think most of us have too much information and are consumers of far too much analysis. Quoting Graham Judgement is different than analysis. There are many analysts who know better than I do that something is cheap but they hesitate to recommend the stock because its falling in price. But even good judgement is insufficient, without execution. Quoting Buffett:

I find earnings calls pretty useful. But it isn't really the management guidance that I appreciate. Its the understanding you get of how analysts see the company since earning calls are basically designed for analysts. The Q&A is always the best part. Also if there are any big issues or problems you will almost certainly hear about them in the earnings call.

I suspected that was the reason. But I think your solution won't be very effective. There is no good substitute for strong families and a good environment. I read a lot of Thomas Sowell. One thing he talks about repeatedly is the vast and incredible difference between black-dominated neighbours during the 1950's and today. There is enormous interest and incentive on the part of liberals to deny that black families were ever ok but its just an enormous lie. There was a time when a black kid could receive education on par with white kids and he could grow up in a relatively safe neighbourhood.

I always thought this was the problem with education...the sheltering from the outside world. Why do you think that is a good thing?

I would end compulsory schooling and privatize public education. My view is that basic schooling should take about 2 years and just focus on reading, writing, and arithmetic. After that you start on a real world project and get a job. Further education should be highly specific, extremely individualized and targeted lasting no more than 1 year (2 years perhaps for doctors or engineers). My model would be coding bootcamps and University of Waterloo. Bootcamps because they are short. Waterloo because of the Co-op. My view is that most education is useless and complete garbage. Probably 90% of what a person in school they never use.

I have a question about that. Why are all the modern ratios using income statement type metrics when what they are really trying to measure cash flow. Why not just use something from the cash flow statement like for instance operating cash flow?

I sold most of my equity positions in late November. My basic reason was interest rate increases and profit margin mean reversion meant that equities would go down. People have been arguing that profits margins don't have to mean revert. I think they do and its a fundamental feature of capitalism. Lets take two examples: Apple and Microsoft. Microsoft has juicy profit margins. And has for a long time. The problem is: how to reinvest all the money it generates. Apple has the same problem. Now in the beginning you find a lot of highly profitable ideas: Ipod, Iphone, Ipad for Apple. Windows, Office for Microsoft. But of course you can't keep changing the world. Eventually you run out of crazy profitable ideas. But then what do you do with the gusher of cash. Stock buybacks will work only when stock prices are low. Eventually you are forced to spend money on things with vastly lower profit margins. In Apples case, Cars. In Microsoft's case, useless acquisitions like Nokia. In Buffett's case you buy a railroad. In my view high profit margins in aggregate are the result of a large huge influx of labour. This happened during the British industrial revolution and is why Karl Marx thought the labor class would be immiserated. But Karl Marx was wrong. Eventually the migration of workers from rural areas to cities dropped and industrial wages started increasing. We had a huge influx of labour since the 1970's due to 3 things: more women working, China's industrial revolution and finally the Baby Boomers. The labour participation rate is now declining in the US. Outsourcing to China has run its course and China's labour force is also shrinking due to the effects of the One Child Policy. There was one other thing that kept profit margins high and that was increasing consumer debt. Thus corporate profits get squeezed on two sides: Price don't go up because of stingy consumers repaying debts and wages go up because there isn't enough labor and there is nothing left to outsource.

1) Most scientific results are garbage. The scientific establishment itself is hugely corrupt. Scientists can't be trusted. And most scientists don't really know much about how to do science properly. They often don't understand basic concepts in their own field. 2) Health care is mostly useless or even very harmful with a very few but extremely important exceptions. The biggest advances in health care have to do with doctors killing you less often. We do not live longer because of health care! 3) Nuclear energy is the future and is incredibly safe. 4) Radiation and radioactivity aren't that dangerous 5) GMOs are safer for you than organic food 6) Democracy is a horrible idea. And America is not a democracy. 7) The FDA is way too permissive 8) Mental illness is not an illness or a health problem and should not be thought of as such. Also psychiatric medications don't work. And depression is not caused by a chemical imbalance in the brain. 9) The root cause of terrorism is not American foreign policy. And a change in foreign policy to better agree with popular will in the Middle East will produce more terrorism not less. 10) Warren Buffet and most investors like him are parasites on society. Donating your wealth to "good causes" (hospitals, education) is mostly stupid and counterproductive but less stupid than Paris Hilton. 11) Modern education teaches people to value authority, avoid thinking for themselves and worst of all heavily devalues knowledge and intellect. Education is anti-educational. 12) Socialism at its best is a slave system. But people are much much happier as slaves! 13) Patriarchy is inevitable 14) AI on Earth will never be a threat to us 15) Business cycles and debt may be necessary for innovation to occur. A more stable economy might be a bad thing. 16) Saudi Arabia is a reasonably well-managed country and we ought to support them 17) Large centralized federal government go hand in hand with capitalism. And both are good things. 18) Elite opinion should have more sway than the so-called common people. Its very good that rich people can corrupt democracy with their campaign contributions.

Deflation is not a problem. Debt deflation can be a big problem. They are not the same thing! The whole current thinking on macroeconomics is just plain wrong. It all originates with the Great Depression where conventional economics had absolutely no way of explaining what was happening. And still doesn't. So they pinned the blame on deflation instead of on debt repayment . Its utterly ridiculous and contradicted by historical evidence. For instance, from 1800-1900 the US experienced deflation and high rates of economic growth simultaneously. In 1800 the price level in the US was 50% higher than in 1900. The following paper looked into the issue across countries and historical periods and finds deflation is rarely associated with depression. https://www.minneapolisfed.org/research/sr/sr331.pdf On there other hand if you want to understand the credit cycle and how debt deflation causes recessions and depressions...I can think of no better explanation than that of Ray Dalio

Argent is interesting. Its an income trust with assets in the US. Capital structure is as follows: 65m USD Revolver (85m CAD) 148m CAD Convertible Debentures. There are backed by assets of 226m CAD. Shares trade at 1 cent. Shares started falling when the company missed production targets. On November 30 the bankers reduced the revolver from 80m USD to 45m USD due to falling commodity prices. Until Argent pays back the 20m they cannot pay dividends to the unit trust holders or interest on the convertibles. They have 60 days to resolve the issue. http://www.argentenergytrust.com/news_release/509 So basically 226m CAD in assets with 86.1m CAD standing in front of the debentures. Lets say the assets sell for 100m CAD. Then Debentures are worth 100m - 86.1m = 13.9m CAD Percentage of face value 13.9m/148m = 9% Currently the debentures trade for 2 dollars. So the upside assuming the oil and gas assets are sold at half their current value is 9/2 = 450%. The catalyst is the 60 day resolution period for the revolver which should be due be end of January. The convertibles were supposed to pay 6% interest this month and this has been suspended. A single interest payment would be triple the current value of the debentures. I feel like I am missing something big here.

Based on something Sculpin posted I did a cap iq screen of all convertible yielding greater than 20%. Attached is the spreadsheet. I used Excel to filter out issuers with negative equity. A few that I noticed and have come up on other threads: Argent Energy Zargon oil & Gas Twin Butte Energy Pengrowth Energy Toscana Energy Fortress Paper The Argent Energy Convertibles have defaulted and have a 350% yield to maturity. convertible_bonds_v2.xls

I didn't because I'm not sure about that yet. I think a lot of (value) investors tend to get overexcited about the narrative and don't pay enough attention to the numbers. The book exemplifies this bias. "Sure, this is a roll-up, is trading at 50x FCF, has a terrible balance sheet and generates no profit yet. But the CEO is an outsider!". Usually followed by the most dangerous words in investing: "this time it's different.". This year we had at least two "outsider" companies which did not do well...Ocwen and Valeant.

Its way too complicated. I would probably have a single item: 1) Avoid companies with significant or complicated off-balance sheet liabilities. I have experience with checklists in other contexts and in my experience the way you create checklists is by trying something and making mistakes. Right after the mistake, you avoid spending time feeling bad and instead you think about how the mistake could have been avoided. Then you create a checklist item accordingly. Checklist are not supposed to cover every possibility. And they should not describe in detail a process or method. They are just supposed to cover things that are frequent sources of error and are specific to the person/organization using them.

I think the US political system is actually pretty good. Its strange to me to see how much people criticize it. I think there should be a debate. I can think of many arguments against any minimum wage. America is not a democracy and it never ever was supposed to be. The Founding Fathers thought democracy was a horrible system and they were right. The fact that economic elites have disproportionate impact on the political system is in my view an extremely good thing and also exactly the way the system was designed to function. I never understand why people are interested in populist democracy. Theoretically democracy doesn't work https://en.wikipedia.org/wiki/Arrow%27s_impossibility_theorem. In the most ideal settings (voters are very interesting in issues, spend enormous time debating) it doesn't work http://marquee.blogs.cnn.com/2011/04/08/showbiz-tonight-flashpoint-is-american-idol%E2%80%99s-voting-system-flawed/ Historically it has never worked. https://en.wikipedia.org/wiki/Athenian_democracy#Criticism_of_the_democracy And presently its a disaster ex. India, Venezuela, Argentina. The hilarious thing to me about all of this is that the whole reason democracy even has a good name today is because of the success of the United States. You shouldn't be criticizing the US for not being democratic enough. You aught to be criticizing democracy for not being US-like enough.

Investing is a zero sum game. Its not a socially useful activity (with the exception of VC and IPOs). We are parasites. Its quite possible to make a lot of money investing without adding any value. I would say that if Buffet had never existed, the world would be more or less the same.

I always believed that this explained his investment in novagold. Its basically an out of the money option on gold.

I'd like to see that math. Making 20% a year it would take you 52 years to turn 100,000 into a billion. Making 8% a year it would take 121 year or so. Good luck!

Well if you are not prepared to ban coverage than the next most rational thing is to just forget about it. Stop concerning yourself about it and treat it as an inevitable fact of life. Its basically the same approach as when you have trouble sleeping. In these cases, ignoring the problem is the best way to stop it from happening because worrying about the problem is exactly what makes it worse. The truth is that school shootings really are no big deal and it makes zero sense to treat it as a major policy issue. The loss of lives from the absence of autonomous cars due to over-regulation would be like multiple mass school-shooting every single day for the whole year. 30000 people die every year in car accidents. 300 people total have died from school shootings since 1980. We REALLY should be doing something to get autonomous cars on the road and we really should be ignoring school shootings. Yet our approach is the exact opposite.