rishig

Here's the best guide I have found so far: https://www.shopify.com/guides/facebook-advertising

The best book that really demonstrates Feynman's talent as a science teacher: QED: The Strange Theory of Light and Matter (https://www.amazon.com/QED-Strange-Princeton-Science-Library/dp/0691164096/ref=sr_1_1?ie=UTF8&qid=1526447049&sr=8-1&keywords=qed+feynman) This topic, Quantum Electrodynamics, is what he won the Nobel prize for. I read this book when I was in my tenth grade, the book has no equations and is written for the layman. How many noble prize winning physicists can explain their theory to a 16 year old in real depth? This is Feynman at his best! Highly recommend it. If you want a more technical book that shows how awesome Feynman is as an undegrad teacher, I recommend the second volume of Feynman's lectures. If you are looking for life of Feynman, I recommend Surely You're Joking..

Having owned BAM for some time now - the major insight I picked up that I did not realize: Many competitors (large banks) have completely exited this area, which I did not realize. I've always worried about too much dumb money coming in, just like the re-insurance business. There is plenty of competition - but the exit of these banks is significant and a strong advantage in my mind. The demand side of the business is pretty obvious, but the supply side is where my concerns are.. -- This business is not as easy as it may look from the outside. The other insight - Bruce Flatt is low key, but confident, and extremely shareholder oriented. He refused to be put on the pedestal with Berkshire and Buffett as an equal - in spite of an admiring and friendly crowd. This CEO is great. One important comment: In his mind, the value of the asset management side of the business exceeds the entire market cap of the company right now. In that regard, you just have to ask yourself is - if you trust the guy and is he competent? Don't be worried. https://photos.app.goo.gl/dsDmI00p8btsrXJn1

You can teach a lot of the mental models stuff to kids, much of it by reading books together. My kids and I have been reading books that teach "systems thinking" concepts - limits to growth, unintended consequences, long-term thinking... https://thesystemsthinker.com/wp-content/uploads/2016/01/PG01E-System-Archetypes-at-a-Glance.pdf

As usual, excellent essay Joel. This kind of synthesis is unprecedented - Congratulations on the great work.

I have been using www.bamsec.com. It is a paid service, but I find it very useful for a one-stop place for all fillings, including transcripts.

For the moment, let's ignore per share data. Here is what I get (all of these are reported numbers). The differences are too large to be minority interest: Year Investments Net Debt Float Common Equity Investments - Net Debt - Float - Equity 2001 10,222.8 1,194.1 5,607.0 1,679.5 1,742.2 2002 10,596.5 1,602.8 5,975.5 1,760.4 1,257.8 2003 12,491.2 1,961.1 6,598.1 2,264.6 1,667.4 2004 13,460.6 1,965.9 7,421.0 2,605.7 1,468.0 2005 14,869.4 1,984.0 8,756.6 2,448.2 1,680.6 2006 16,819.7 1,613.6 10,518.8 2,662.4 2,024.9 2007 19,000.7 1,207.4 10,548.0 4,063.5 3,181.8 2008 19,949.8 412.5 10,841.9 4,866.3 3,829.1 2009 21,273.0 1,071.1 11,537.4 7,391.8 1,272.7 2010 23,300.0 1,254.9 13,109.5 7,697.9 1,237.7 2011 24,332.5 2,055.7 14,399.0 7,427.9 449.9 2012 26,094.2 1,920.6 15,879.2 7,654.7 639.7 2013 24,861.6 1,752.9 15,550.5 7,186.7 371.5 2014 26,192.7 1,966.3 15,065.0 8,361.0 800.4 2015 29,016.1 2,075.6 17,072 8,952.5 916.0 2016 28,430.7 3,438.2 16,673.0 8,484.6 (165.1) For instance, the numbers in 2008 are very off. I am sure I am wrong somewhere.

For the moment, let's ignore per share data. Here is what I get (all of these are reported numbers). The differences are too large to be minority interest: Year Investments Net Debt Float Common Equity Investments - Net Debt - Float - Equity 2001 10,222.8 1,194.1 5,607.0 1,679.5 1,742.2 2002 10,596.5 1,602.8 5,975.5 1,760.4 1,257.8 2003 12,491.2 1,961.1 6,598.1 2,264.6 1,667.4 2004 13,460.6 1,965.9 7,421.0 2,605.7 1,468.0 2005 14,869.4 1,984.0 8,756.6 2,448.2 1,680.6 2006 16,819.7 1,613.6 10,518.8 2,662.4 2,024.9 2007 19,000.7 1,207.4 10,548.0 4,063.5 3,181.8 2008 19,949.8 412.5 10,841.9 4,866.3 3,829.1 2009 21,273.0 1,071.1 11,537.4 7,391.8 1,272.7 2010 23,300.0 1,254.9 13,109.5 7,697.9 1,237.7 2011 24,332.5 2,055.7 14,399.0 7,427.9 449.9 2012 26,094.2 1,920.6 15,879.2 7,654.7 639.7 2013 24,861.6 1,752.9 15,550.5 7,186.7 371.5 2014 26,192.7 1,966.3 15,065.0 8,361.0 800.4 2015 29,016.1 2,075.6 17,072 8,952.5 916.0 2016 28,430.7 3,438.2 16,673.0 8,484.6 (165.1)

Fairfax experts, can you help me reconcile something in the data. I have put together what net investments per share has been, as well as net debt, float and book value per share. I see that net investments / share = net debt / share + float / share + book value / share + something / share. The last part "something / share" grows to be significant as I go back to earlier years. What is this other stuff? All the other numbers are as quoted from annual reports. Year Investments / Share Net Debt / Share Float / Share Book value / Share 2001 710 83 389 117 2002 752 114 424 125 2003 905 142 478 164 2004 841 123 464 163 2005 835 111 492 138 2006 950 91 594 150 2007 1073 68 596 230 2008 1140 24 620 278 2009 1064 54 577 370 2010 1137 61 639 376 2011 1193 101 706 364 2012 1292 95 786 379 2013 1173 83 734 339 2014 1236 93 711 394 2015 1307 93 769 403 2016 1231 149 722 367

I will second that!!! Me too!!

There is enough data out there that is contrary to what you have heard imo. mc-advertising-index-q1-2017.pdf

I agree with you completely on FB ad targeting capabilities. I doubt very few of you on here have ever used either AdSense or FB ads. I was a bear on FB when it IPOed and yet I ignored it when my friend who had a small website making him a little side hustle money told me that he was dabbling in Facebook ads and his ROI was tremendous. I watched him kill it and was envious for him and yet still couldn't make the leap to buy FB stock. His cost of ads double annually and yet still have a positive ROI due to the segmenting that he does. His business almost did $10M in sales this last year up from $5M the year before and he grows the majority of his sales via FB and less so Intragram. He still advertises on Goog and its ok but he is interested in a new Youtube sales channel that is supposed to be coming. GOOG has been slow on this. Along these lines, I have been watching SharkTank (on ABC) since Season 1. It is pretty amazing how many small business can jump start to millions in sales simply through FB advertising.

A question to ask is why bother? May be you are better off putting whatever time you have into something that excites and motivates you. For the financial part, just save more than you spend and invest into a low cost index fund. You are likely to do reasonably well.

BAM has very little corporate leverage. The leverage at the level of listed entities is also limited. Most of the leverage you see in the consolidated balance sheets is on a per project level. Also, BAM is very conservative in its financing - most of it is quite long term and fixed. Most of the carried interest is unrealized.

I think a privatization of infrastructure should benefit BAM. More opportunities should generally help them even if there are competitors in the space. Not everyone has the scale of BAM and if the market grows then BAM should be able to continue to grow. I would be very interested if you would provide a brief valuation of BAM. What CAGR do you believe BAM could achieve over the next 10-20-30 years? Why? Thanks. Here is how I value BAM: TTM Fee Earnings: $660M x 20 = $13.2B Target Carried Interest: $540M x 10 = $ 5.4B Invested Capital: $29.7B x 1 = $29.7B Borrowing: =($ 4.5B) Working Capital: =($ .2B) Preferred Shares: =($3.7B) Total: =$39.9B Shares Outstanding: =1B Intrinsic Value per share: =~40$ Current share price: =32.5$ Share price / Intrinsic value =80% Note that the fee income has grown from $180M 4 years ago to $660M today - CAGR of 38%. Even if interest rates go up, and assets move from bonds, not all the assets are going into equity.