farnamstreet

JaeHong Park, Prabhudev Konana, Bin Gu, Alok Kumar and Rajagopal Raghunathan conclude that investors use stock message boards to seek information that meets (rather than disproves) their prior beliefs. Prior studies accounting and finance suggest that virtual communities often provide more accurate information than analyst forecasts. For example, early evidences of Enron collapse from accounting tricks were first reported in message boards. http://bit.ly/aP5hRO

Thought you'd enjoy a summary of the book Buffett apparently didn't recommend after all. Inflation and its devastation was one of the reasons that Hitler was able to take control of Germany. http://1440-68131.blogspot.com/2010/07/when-money-dies-inflation-drug.html

http://myinvestingnotebook.blogspot.com/2010/07/tilson-presentation-on-bud-msft-and-bp.html

A lot of you liked the Jamie Dimon reading list. Here is the Fortune CEO reading list. Crash Course looks interesting. http://1440-68131.blogspot.com/2010/07/fortunes-summer-ceo-reading-list.html

This is kind of a general post on competition and how some businesses take an expensive route to commoditization. http://bit.ly/ag1AKC

I know quite a few of you are voracious readers. I thought you might enjoy this reading list that Jamie Dimon put together for his summer interns. http://1440-68131.blogspot.com/2010/06/jamie-dimons-summer-reading-list.html

At first this might seem a little off topic, but I think it's incredibly valuable to understand why we choose one brand over another. In the case of Coke, people actually prefer the taste of Pepsi, yet Coke still leads the market. http://bit.ly/9GNAt7

http://cbs360.gsb.columbia.edu:8080/ess/echo/presentation/749b9e77-b822-456f-8784-9dff07518360

Tilson, explains in great detail (10 pages) why he's long BP http://myinvestingnotebook.blogspot.com/2010/06/why-were-long-bp.html

Wasn't the AAP tender just a thinly veiled attempt to divert attention away from the compensation agreement? Can anyone argue otherwise given the terms of the tender? I believe someone on a previous thread asked why he's not buying back shares? I think it has to do with incentives. Although the compensation arrangement will supposedly compensate him for buy backs and make that neutral, it will, almost regardless of how they count it, shrink overall equity. Given that his bonus is derived from overall equity, anything that shrinks equity will also shrink his bonus (even after accounting for buybacks). So why is the lionfund buying shares? Well the shares might be thought of as a good bargain, or he might just want to increase the odds that his compensation scheme is passed. However, if the lion fund consists mostly of WEST debt and SNS shares (which it does) how valuable is that? If you're an investor with millions why would you invest in the lionfund? if you want Sardar to run your money for whatever reason (have you googled the guy?!) why would you choose LF over BH? Also, the earlier question remains, anyone who googles Sardar Biglari will quickly discover he's not the most trustworthy guy. So the type of capital he attracts will be different and quick to jump ship. It's only a matter of time before someone points out the (obvious) insider trading (actually, i think i might just send an email to the SEC myself) that happened with the compensation agreement. While Sardar sold the company for $1, he sold his capital account for par. That capital account consists of a significant percentage of BH shares. It's not as obvious as some insider trading (likely why the SEC hasn't found it) but it's still the same. The guy then slaps everyone in the face -- he used that $4m (of which a percentage was derived from selling BH shares around $400) to buy back a lot of BH shares under $300. Looking at Sardar through the lens he deserves, rather than the one he wants, shows you different motivations behind his actions. Most of the (individual) shareholders who voted for him in the SNS proxy are gone. It sounds pretty crude but he exchanged them for money. There are other red flags with Sardar as well, but no need to recap them all. We don't want the site getting coincidentally hacked again do we? One question that lingers with me, is does John Linnartz feel like a fool? Oh, and to the person from this board that emailed my parable to the entire SNS corporate exec, I think you're awesome.

http://bit.ly/92o9je

Here is the GGP presentation that Ackman gave at Ira Sohn http://bit.ly/9JNO4W

A previously lost lecture unearthed by Jason Zweig! http://bit.ly/cJS2hr

http://bit.ly/aSDp8f

http://bit.ly/clJ3FK

http://bit.ly/bwXNZe

In this blog post I draw on the examiner's report to walk through what happened with illustrative examples of how the balance sheet changes depending on (1) the classification of repos (financing or sale) and (2) what Lehman did with the cash (nothing or repurchase debt). http://bit.ly/akobQB

Watch the segment here. http://bit.ly/9xWEKe

In this excerpt from his annual letter, investing great Seth Klarman describes 20 lessons from the financial crisis which, he says, “were either never learned or else were immediately forgotten by most market participants.” http://bit.ly/ck0xki

A parable about how one nation came to financial ruin (Slate.com) http://www.slate.com/id/2245328/pagenum/all/

http://bit.ly/cPenc7

http://goo.gl/fb/ojz1

You can find out more about MAAL and Matt's and Joe's thoughts on Joe's blog: http://valueinvestingworld.blogspot.com/2009/04/marketing-alliance-micro-cap-with_22.html

In an interview with ABC, Buffett says restricting banker bonuses only benefits shareholders. "I don't think it makes sense … The banks are not going to be the cause of big losses in the TARP program, maybe the auto companies will," Buffet said."It's a separate situation." http://bit.ly/cnpbS7

Buffett's Letter to Paulson can be found here http://bit.ly/9R3wee