whiterose

Then off to New Zealand, shepherding..

Is there any way to challenge the result via the legal system in the US? I guess a vote for a third party candidate was a vote for Trump after all, now that it is so close. A lot of liberals/greens had the Democrats as second choice or at least more than the Republicans. In this election it would have been better to vote strategically, rather than on principle, as many liberal pundits suggested. Would be interesting if Clinton still wins in the last minute..

Yeah I am.. still awake at 5am in europe. It's f***ing unbelievable, a Brexit-like event at a much larger (global) scale. I'm really disappointed by the outcome and the huge number of people Trump was able to rally.

How are you going to do that? I guess the first-level-thinking approach is kind of illegal, on the second level you could maybe go long plastic surgery, cosmetics, hideous fashion.. :P

Buffett, Zell et al: https://priceonomics.com/in-defense-of-mobile-homes/

Can you elaborate, what makes you say that?

I'd like to think it's still true, at least from an outside perspective. That's why the US is still #1 on anyones (professional/hard-working) list who want's to make something of themselves. Being a citizen in an european country is comparable of being born into a (fairly homogenous) family, i.e. you can't choose the family members and have to get along nevertheless. It seems like in the US you are among like-minded people, at least just referring to the very most basic thing; why are we here. Sorry for getting a bit OT, but I can really sympathize with the (flag-weaving) patriotism after desasters (9/11, Katrina etc). I understand it's not about the state or the military, but western/liberal values, which were originally championed in europe but seem to be on a decline. That is basically the raison d'être of the large social programs in western europe. The citizens can't stand the fact of seeing people living on the streets or having to deal with sick/really poor people, independendly of where the come from, why they are living this way, what choices were made beforehand etc. Even if you squander willingly all your wealth before retirement, a large percentage will always say we can't let him live on the street/go hungry/get sick, so you get taken care of no matter what. Also a bit OT: There was a couple of days ago a high-profile case in germany where a syrian immigrant got his hands on a lot of explosives, but the plot was fortunatly discovered by the police. Then he managed to flee but was captured by some fellow syrian mates who turned him in. He then committed suicide, in police custody inside the jail cell. Now the police and the state gets all the blame for letting the man die. So much for individual rights. Edit: Because it's constitutional law: the state has the duty to protect it's citizens (or even all humans?), even against their will, like in force-feeding inmates or forcing to get medical help in jail etc.

Maybe, but even simpler as a comparison is the knowledge of an imminent product recall of this specific model, which the seller knows about but the buyer doesn't (yet). I'm not saying that there is misrepresentation about what you are buying (stock certificate). The seller has no obligation to inform or educate the buyer. It's not about the amount of information rather than the timeliness of dissemination. Maybe one could think of it as front-running on a longer timeframe. The HFTs use fiberglass cables and move their servers in front of the exchanges to eke out some milliseconds to get an advantage. (Which is not illegal, but shows the value of this unevenly distributed information, even if it's useful for only a few ms). The trader who acts on material inside information is doing the same with a (positive) time-shift of a few hours/days/weeks. This. Society as a whole is better off with efficient, fair and smoothly functioning capital markets. That's why the regulators etc. (and ad-hoc-statements, quarterly reports) exist. The upside for the government/society to regulate the used car market in the same way is simply not there.

I disagree. In your example the seller without the material information would be harmed, because he sold at a discount to the potential "true" price once the news were out and known to all investors. Just like buying a used car, where the seller knows of some (hidden) defects and the buyer overpays therefore. You can't argue the buyer had bought it anyway on that day for that price.

I guess the taxes become relevant, if one would liquidate the theoretical 1m-cash company after paying the cash out as dividend. But since most companies are valued as "going-concern", the cash will be still "there" in one way or another, like working-capital. A future potential buyer would value it the same way one did in the beginning when buying it.

http://www.vanityfair.com/news/2016/09/elizabeth-holmes-theranos-exclusive

This short TED-talk may be of interest with the Berkshire holding structure in the back of your mind:

Yes, thanks again for the clarification.

Ok, makes sense. But does it imply that over the last 100 years the time value of money was 7-10%? Weren't sovereign long-term bonds yields on average much lower as a benchmark? Is the spread (equity risk premium) entirely due to credit risk and a volatility premium? Isn't the overall long-term credit-risk in the US equity market quite low or even non-existent looking back? Yes, population growth/decline should be reflected in g.

Ok that's true, but shouldn't then P1 be discounted again to P0? According to an admittedly simplified Dividend Growth Model: P0 = D1/(r-g) ~ (D2/(r-g))/r ? The point is, could the market in the 1960s e.g. had predicted current earnings from 2016 and then discounted them correctly. It would be cool to have 40y rolling eps predictions to see the possibly permanent underrating of g or overrating of r.

@Jurgis There is some uncertainty about g, but shouldn't the market guess future g and discount it at time 0 so that PV(1) or PV(infinity) can be derived/computed? Like if you use the rate of return(inflation + real interest rate + equity risk premium) as the discount rate, isn't the PV kind of static(-/+error term as time goes by), assuming the "forecast" is validated by future observations/data?

This is maybe a naive and possibly a philosophical question, but please hear me out: I was wondering, why the market as such, let's say the S&P500 is expected to rise x% per year and even has been historically (7-10%) over long periods of time. If one would assume, in an ideal world, stocks are (fairly) valued, based on discounting all of the real future cashflows, shouldn't the inflation adjusted price be essentially flat over time? It can only rise if there are some not yet discovered/materialised profits on the way (for now irrelevant to where they come from). Is it because investors as a group structurally underestimate positive surprises in growth/innovation/efficiency-gains? I would like your thoughts on the matter, maybe I am missing something. Thanks!

Hey Guys, I just registered but have been a long time reader of this great forum. The topic of second careers is for me at least quite current. I work as a programmer (for some years, in europe, late 20ies) and earn just about average but am able to save a bit due to my minimalist approach to life. But I learned to strongly dislike the job and the people you have to converse with (possible just a singular experience). To make a long story short, I am now in the process of looking for another job in the investment/banking sector, hopefully a CFA designation is helpful in that regard and it is not to late.. The golden handcuffs are unfortunately really a thing, I can't bring myself to just quit while still not having found an alternative. (Sorry for my english.)