tede02

I started a small position in Mattel.

I was thinking about this a bit more. Would be nice if the US could perfect missile defense and surround N. Korea with these systems. That would really be amazing. It would be the ultimate slap in the face against the regime. They've spent all this time, money and bluster on missiles and then they're neutralized. Kim has bet basically everything on missiles. That's his only bargaining chip. He'd have to go completely back tot he drawing board. Of-course, the technical problem here seems very significant. I haven't read much about missile defense but it appears to be pretty tough to master.

Someone I know took one of these get rich quick trading classes within the past few years. I'll refer to the person as Bob. Sadly the strategy hasn't made Bob rich. Yet, Bob told me today, quite convincingly, that he keeps in touch with the person who taught the class and that this person is earning 10% per month. Now, I like Bob so I tried to be polite. I grabbed my financial calculator and showed how 10% compounded monthly for a year over triples your money. I proceeded to show Bob how $10k turns into $3 million in five years, and nearly $1 billion in ten. Bob was a little surprised and said it must not be 10% "every month." LOL One thing Ed Thorp said in his memoir was when he started learning about the markets and investing, he realized how little is known by so many. That seems just as true today. In-fact, there is so much noise (CNBC, 24 hour news, a zillion blogs, etc.) to distract people, perhaps the environment is more challenging for the masses than ever. Another way to put it is with all the noise, and the ease of trading via online platforms, it is probably easier than ever to make mistakes. The paradox is investing professionals seem to be having as hard a time as ever relative to the markets. Perhaps that will change when the cycle finally turns but it is quite interesting. Just some random thoughts from my day.

;D

Just for fun...I keep hearing Trump take credit for the raging bull market. When it finally turns, no way he'll take credit for that. Who's going to get the blame? Did I miss any possiblities? I suppose I could have added Hillary. ;)

Thanks Hielko. I guess ZAC is equivalent to US cents. Thus, the stock is trading at 2,991 ZAR which brings the conversion in line. Thanks guys.

This is specific to Naspers Limited which is South African based. I must be missing something. As I see it, the common is trading for 291,000 in home currency (ZAR). The currency conversion to USD is currently $0.075. Thus, the conversion gets me to share price of $21,952.35. However, the ADRs are trading at $23.35 with a 10:1 ratio. But that translates into a $233.50 share price which is off by nearly a factor of ten (actually 100). What am I missing here? Is there another share class that the ADRs are being based off? Any insight would be greatly appreciated. (Probably a stupid question with the answer looking me in the face.)

Trump keeps taking credit for the market being up, so he'll have to own it when things go the other way.... ;D

Bubbles really are hard to define with any precision. Looking back to 2007, were stocks in bubble territory? Seems like a tough case to make in comparison to residential real estate at that time. An easier case to be made for that period is many companies were over-levered. I view stocks as generally expensive today. To me that just means there is more risk in the market place and thus, one must be that much more cautious. The significant rise in prices over the last year is interesting considering what I perceive as moderate confidence in both the economy and financial markets by the public. What is driving the rally? I do worry about all the money pooring into index funds. I think the public wrongly equates index funds as being "safer" investments.

Curious if people think 2008 was a bubble for US stocks?

I think it depends on what you're looking for. I have Kahnemann's book. I've only made it through the first few chapters. No surprise, it is much more intellectual. If that is what you prefer, no doubt Kahnemann's book is for you. If you learn well through stories, or like biographies, you'd probably be better off with Lewis' book.

I'm surprised this book hasn't received more accolades on the board. I just finished listening to the audio version. The ideas are enormously powerful for the purposes of decision making in virtually all areas of life. I bought the actual book and intend on going through it again. If you are interested in building mental models or checklists to improve your decision making, this book is a necessity.

Minnesota

I like Bob Rodriquez, and his old firm FPA. But with respect to his macro views, I'm not quite convinced he's as clairvoyant as his confident tone always suggests. Historically there seems to be a crisis or severe market correction every 5-10 years. If you just keep saying one is coming, eventually you'll be right. He lays out the case well regarding the difficult task for active managers. If you try to be prudent and discplined when valuations are high, you end up getting fired because of the drag cash has in a bull market.

The real interesting, and timely, thing about the Madoff story relayed by Thorp is that according to Bloomberg, Madoff is trying to help some former investors by arguing that his fraud started in 1992, so anything they took out of the fund prior to that year was not part of the Ponzi scheme. (https://www.bloomberg.com/news/articles/2017-06-23/madoff-clients-fighting-for-fortunes-get-help-from-the-con-man) But if you follow the timeline for when Thorp figured out the fraud, it's 1990. Not surprising that a liar continues to lie - mostly surprising that anyone would take his statements as evidence... Absolutely. I wouldn't doubt if the fraud went back long before 1990 even. Thorp's life story was just great. Self made, and got it done with no shenanigans. Plus all the people he encountered throughout his life (the Las Vegas people and east coast guys who funded his gambling venture, Feynman, Buffett, Claude Shannon, Madoff, etc.).

The trouble with socialism is it seems gradually expand and you can never peel it back without a crisis. It reminds me a lot of union benefits that get fat during good times. When things go south, no one is willing to give anything up until either the companies go broke, pension funds are exhausted, etc. I think its just human nature. I hear relatives and friends bashing socialism regularly. Then you start talking about peeling back specific socialistic programs (like Social Security, Medicare, Medicaid, the public school system, state parks, national parks, law enforcement, roads & bridges, and on and on) and they go silent. It demonstrates how challenging the problem is. My dad loves to ask the rhetorical question, "Can we govern ourselves?" I think its an open question but in the more narrow issue of managing our own financial affairs (as nations), I'm definitely pessimistic.

Interesting discussion. I've bought three vehicles in the last 12 months. Never would I have imagined doing that but circumstances required it. All three vehicles were used. Two were purchased from traditional dealers one from a used car lot. Buying cars from dealers vs. private party is another thing I wouldn't have expected doing. Anyway, I feel like my wife and I did pretty good on the prices. I attribute most of our success to spending the time doing some research to get a good sense of where prices were and being patient for a deal. My experience has been that the dealers are really reluctant to move much on price. After we bought the last vehicle most recently I asked the sales guy about it. This was at a Toyota dealership. His view was that pricing is much more efficient today (he said he's been selling cars for 25+ years) because of the internet so dealers generally don't have much if any wiggle room. He also said that the salespeople (at this dealership at least) no longer are paid a commission, they're salaried. That was a surprising comment but I assume that it depends on the individual dealership and there are other bonuses for production, etc. Based on some of the other experiences shared here, clearly there are times when the dealers are more willing to negotiate than others.

As with others, I'd suggest ebay. I bought one a number of years ago just out of curiosity. I think I paid like $25. Gosh, its probably been ten years as I think about it.

The thing about newspapers, especially national publications, is many of the stories are the same or follow-ups from ongoing sagas. Thus you can skim through each paper pretty quickly because there is a lot of over-lap. I think Mephistopheles is right on. Buffett and those guys know what is important and what can be dismissed very quickly.

An excellent read and philosophy that would have saved me a lot of pain in the past... http://www.fpafunds.com/docs/special-commentaries/two-decades-of-winning-by-not-losing_may-201791EDCCEAD617.pdf?sfvrsn=2

CHK and BXE. Both of which I had no business buying and probably contributed only negative IQ to the threads.

As Liberty said, this is a thorough biography. Lots of details about Buffett's personal life. If you're more interested in his investing and business career, Lowenstein's book is excellent (it has much less about Buffett's personal life so its a lot shorter). I enjoyed Snowball and would recommend it if you really want the full picture of Buffett as both a person and businessman/investor.

Just finished. Excellent read. I'd highly recommend it. It was particularly interesting reading about the history of quantitative hedge funds. This is something I knew very little about. Ed Thorp's life story great in itself. I think you could make a movie about it. Pretty amazing that he identified the Madoff fraud almost 20 years before it imploded.

Relating to examples, I always like to ask, "What investment mistakes could you have avoided by reading more SEC filings?" For me (and I believe most people), far and away its the psychological errors and big picture misses that contribute to the vast majority of investment mistakes.

Have fun guys. This is the first meeting I've missed in ten years. I might check out the live stream on Yahoo.